June 2004 Profitwise News and Views

In Brief

Final Rules for FACT Act Approved
The Federal Reserve Board recently announced its approval of final rules to establish effective dates for all provisions of the Fair and Accurate Credit Transactions Act of 2003 (FACT Act) that do not have a statutorily prescribed effective date. These regulations are being issued jointly with the Federal Trade Commission.

The FACT Act became law on December 4, 2003. In general, the Act amends the Fair Credit Reporting Act (FCRA) to enhance the ability of consumers to combat identity theft, to increase the accuracy of consumer reports, and to allow consumers to exercise greater control regarding the type and amount of marketing solicitations they receive. The FACT Act also restricts the use and disclosure of sensitive medical information. To bolster efforts to improve financial literacy among consumers, Title V of the Act (entitled the "Financial Literacy and Education Improvement Act") creates a new Financial Literacy and Education Commission empowered to take appropriate actions to improve the financial literacy and education programs, grants, and materials of the federal government. Lastly, to promote increasingly efficient national credit markets, the FACT Act establishes uniform national standards in key areas of regulation.

The recently enacted FACT Act amended the FCRA and required the Board and the FTC to adopt final rules establishing the effective dates for certain provisions of the FACT Act. In mid-December, the Board and the FTC jointly adopted interim final rules that established December 31, 2003 as the effective date for the preemption provisions of the FACT Act, as well as provisions authorizing the agencies to adopt rules or take other actions to implement the FACT Act. The agencies now have adopted final joint rules with the same schedule of effective dates contained in the interim rules.

Also in mid-December, the Board and the FTC jointly issued for comment proposed joint rules that would establish a schedule of effective dates for other provisions of the FACT Act that do not contain effective dates. After reviewing the comments on the proposal, the agencies adopted joint final rules that established March 31, 2004, as the effective date for the provisions of the FACT Act that do not require significant changes to business procedures. With respect to other provisions that likely entail significant changes to business procedures, the joint final rules make these provisions effective on December 1, 2004, to allow industry a reasonable time to establish systems to comply with the statute. On June 8, 2004, the Board issued amendments to Title V, adding model notices for financial institutions to use if they provide negative information to consumer reporting agencies, and guidance for their use.

CEDRIC
The Consumer and Economic Development Research and Information Center (CEDRIC) was first introduced to the public via the Federal Reserve Bank of Chicago's Website in 1998. Its principal mission is to foster research related to consumer and economic development issues such as consumer and small business financial behavior, access to credit, affordable housing, and community development and reinvestment.

CEDRIC serves as a portal for sharing relevant community and economic development information, and houses several related resources: Research Repository, Financial Education Research Center, Lessons Learned: Community and Economic Development Case Studies (LesLe), and Household & Small Business Data Web pages. CEDRIC also provides a subject listing describing the topics in each repository category, a Federal Reserve System publication listing, valuable data resources, links to CEDRIC partners, and a calendar of industry events taking place throughout the nation. Also included on the site are proceedings and papers from past Federal Reserve System research conferences, links to a glossary of community development terms and Federal Reserve System community and economic development programs and initiatives.

CEDRIC's Research Repository
CEDRIC's Research Repository includes abstracts of research studies, reports, articles, working papers and other studies generated by Federal Reserve researchers and analysts, academicians, government agencies, and nonprofit organizations. Currently there are nine categories: Community and Economic Development, Consumer Financial Behavior, Financial Literacy and Consumer Education, Housing, Immigrant (financial) Access, Indian Reservation Development, Institutional Behavior, Scale/Sustainability (of community based organizations), and Small Business.

CEDRIC recently updated its repository database with a more user-friendly search engine. The search function will find all documents associated with a word(s) or phrase entered. The title, subject, keyword, and author fields in our database are searched automatically; other categories can be added to a search. A quick search of a particular category is also an option.

Financial Education Research Center
The Financial Education Research Center seeks to promote excellence in financial education by providing online resources for researchers, educators, program directors, and others interested in supporting these types of programs and initiatives. These resources include a research repository of studies with topics such as: credit and debt management, financial education programs, insurance issues, resources for economic education, credit and debt management, retirement planning, savings and spending, and tax topics.

Also included on this page is a listing of major financial education programs throughout the country. The listing includes the organization's name, contact information, and a brief description of the financial education products and services offered. The programs are grouped by the following categories: federal agencies and programs, Federal Reserve initiatives, financial institutions and corporations, Internet resources, national organizations and initiatives, and university/cooperative extension programs.

Lessons Learned: Community and Economic Development Case Studies (LesLe)
LesLe is a searchable database of case studies about community development practices and programs. The case studies identify a problem, the solution, results, and the lessons learned about the financing of community and economic development projects and programs. LesLe case studies are selected with consideration to their potential for replication into other geographic areas.

Community Surveys & Data
Household & Small Business Data. The purpose of this Web page is to provide researchers and community development professionals with household and small business survey instruments and data from diverse communities. The data reflect the diverse perspectives of the original researchers and offer detailed information about the economic and social circumstances of households and small business owners. The surveys cover access to credit, household and business finance, and small business development.

We encourage users to contribute relevant papers, studies, and program descriptions to CEDRIC. Visit CEDRIC on the Federal Reserve Bank of Chicago's Web site. For further information, contact CEDRIC's coordinator.