On October 28, 2025, in a significant move toward regulatory clarity, the Consumer Financial Protection Bureau (CFPB) issued a new interpretive rule reaffirming the broad preemptive scope of the Fair Credit Reporting Act (FCRA) over state laws. This rule replaces the narrower interpretation issued in July 2022, which the CFPB formally withdrew in May 2025.
Why This Matters
The FCRA, enacted in 1970 and amended multiple times since, governs the creation and use of consumer reports. It has always included a preemption clause, but the scope of that clause has evolved. In 1996, Congress expanded FCRA’s preemption to cover specific subject matters, aiming to prevent a fragmented regulatory landscape. This expansion was made permanent in 2003 to support a unified national credit reporting system.
The CFPB’s latest interpretive rule confirms that the FCRA broadly preempts state laws that touch on the subject matter regulated by the federal statute. This clarification is intended to promote consistency across the credit reporting industry and ensure that consumers and businesses operate under a single, coherent set of standards.
The Shift from 2022
The 2022 interpretive rule argued for a narrow reading of FCRA’s preemption clause, suggesting that states could regulate areas like medical debt, rental information, and arrest records unless those regulations directly conflicted with specific FCRA provisions. The CFPB now asserts that this interpretation was flawed, both legally and practically.
According to the Bureau, the language of the FCRA—particularly section 1681t(b)(1)—uses broad terms like “no requirement or prohibition” and “with respect to any subject matter regulated under,” which indicate Congress’s intent to occupy the field of consumer reporting. The phrase “relating to” further expands the scope, encompassing any state law connected to the topics covered by the FCRA.
Legal and Legislative Support
The CFPB’s position is supported by legislative history and judicial precedent. Congress explicitly aimed to create national standards to avoid a “patchwork system of conflicting regulations.” Courts have consistently interpreted the FCRA’s preemption clause broadly, finding that state laws addressing the same subject matter as federal provisions are preempted even if they don’t mirror the exact language of the FCRA.
Implications on Compliance
While the CFPB’s interpretive rule provides helpful guidance, it is important to note that interpretive rules are not binding on any court. Courts may choose not to adopt the CFPB’s interpretation, and legal challenges could arise depending on jurisdiction and context.
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