§ 1691c-1. — Incentives for selftesting and selfcorrection.
[Laws in effect as of January 24, 2002]
[Document not affected by Public Laws enacted between
January 24, 2002 and December 19, 2002]
[CITE: 15USC1691c-1]
TITLE 15--COMMERCE AND TRADE
CHAPTER 41--CONSUMER CREDIT PROTECTION
SUBCHAPTER IV--EQUAL CREDIT OPPORTUNITY
Sec. 1691c-1. Incentives for self-testing and self-correction
(a) Privileged information
(1) Conditions for privilege
A report or result of a self-test (as that term is defined by
regulations of the Board) shall be considered to be privileged under
paragraph (2) if a creditor--
(A) conducts, or authorizes an independent third party to
conduct, a self-test of any aspect of a credit transaction by a
creditor, in order to determine the level or effectiveness of
compliance with this subchapter by the creditor; and
(B) has identified any possible violation of this subchapter
by the creditor and has taken, or is taking, appropriate
corrective action to address any such possible violation.
(2) Privileged self-test
If a creditor meets the conditions specified in subparagraphs
(A) and (B) of paragraph (1) with respect to a self-test described
in that paragraph, any report or results of that self-test--
(A) shall be privileged; and
(B) may not be obtained or used by any applicant,
department, or agency in any--
(i) proceeding or civil action in which one or more
violations of this subchapter are alleged; or
(ii) examination or investigation relating to compliance
with this subchapter.
(b) Results of self-testing
(1) In general
No provision of this section may be construed to prevent an
applicant, department, or agency from obtaining or using a report or
results of any self-test in any proceeding or civil action in which
a violation of this subchapter is alleged, or in any examination or
investigation of compliance with this subchapter if--
(A) the creditor or any person with lawful access to the
report or results--
(i) voluntarily releases or discloses all, or any part
of, the report or results to the applicant, department, or
agency, or to the general public; or
(ii) refers to or describes the report or results as a
defense to charges of violations of this subchapter against
the creditor to whom the self-test relates; or
(B) the report or results are sought in conjunction with an
adjudication or admission of a violation of this subchapter for
the sole purpose of determining an appropriate penalty or
remedy.
(2) Disclosure for determination of penalty or remedy
Any report or results of a self-test that are disclosed for the
purpose specified in paragraph (1)(B)--
(A) shall be used only for the particular proceeding in
which the adjudication or admission referred to in paragraph
(1)(B) is made; and
(B) may not be used in any other action or proceeding.
(c) Adjudication
An applicant, department, or agency that challenges a privilege
asserted under this section may seek a determination of the existence
and application of that privilege in--
(1) a court of competent jurisdiction; or
(2) an administrative law proceeding with appropriate
jurisdiction.
(Pub. L. 90-321, title VII, Sec. 704A, as added Pub. L. 104-208, div. A,
title II, Sec. 2302(a)(1), Sept. 30, 1996, 110 Stat. 3009-420.)
Effective Date
Section 2302(c) of div. A of Pub. L. 104-208 provided that:
``(1) In general.--Except as provided in paragraph (2), the
privilege provided for in section 704A of the Equal Credit Opportunity
Act [15 U.S.C. 1691c-1] or section 814A of the Fair Housing Act [42
U.S.C. 3614-1] (as those sections are added by this section) shall apply
to a self-test (as that term is defined pursuant to the regulations
prescribed under subsection (a)(2) [set out below] or (b)(2) of this
section [42 U.S.C. 3614-1 note], as appropriate) conducted before, on,
or after the effective date of the regulations prescribed under
subsection (a)(2) or (b)(2), as appropriate.
``(2) Exception.--The privilege referred to in paragraph (1) does
not apply to such a self-test conducted before the effective date of the
regulations prescribed under subsection (a) or (b), as appropriate, if--
``(A) before that effective date, a complaint against the
creditor or person engaged in residential real estate related
lending activities (as the case may be) was--
``(i) formally filed in any court of competent jurisdiction;
or
``(ii) the subject of an ongoing administrative law
proceeding;
``(B) in the case of section 704A of the Equal Credit
Opportunity Act, the creditor has waived the privilege pursuant to
subsection (b)(1)(A)(i) of that section; or
``(C) in the case of section 814A of the Fair Housing Act, the
person engaged in residential real estate related lending activities
has waived the privilege pursuant to subsection (b)(1)(A)(i) of that
section.''
Regulations
Section 2302(a)(2) of div. A of Pub. L. 104-208 provided that:
``(A) In general.--Not later than 6 months after the date of
enactment of this Act [Sept. 30, 1996], in consultation with the
Secretary of Housing and Urban Development and the agencies referred to
in section 704 of the Equal Credit Opportunity Act [15 U.S.C. 1691c],
and after providing notice and an opportunity for public comment, the
Board shall prescribe final regulations to implement section 704A of the
Equal Credit Opportunity Act [15 U.S.C. 1691c-1], as added by this
section.
``(B) Self-test.--
``(i) Definition.--The regulations prescribed under subparagraph
(A) shall include a definition of the term `self-test' for purposes
of section 704A of the Equal Credit Opportunity Act, as added by
this section.
``(ii) Requirement for self-test.--The regulations prescribed
under subparagraph (A) shall specify that a self-test shall be
sufficiently extensive to constitute a determination of the level
and effectiveness of compliance by a creditor with the Equal Credit
Opportunity Act [15 U.S.C. 1691 et seq.].
``(iii) Substantial similarity to certain fair housing act
regulations.--The regulations prescribed under subparagraph (A)
shall be substantially similar to the regulations prescribed by the
Secretary of Housing and Urban Development to carry out section
814A(d) of the Fair Housing Act [42 U.S.C. 3614-1(d)], as added by
this section.''
