Virginia Commission Makes No Recommendation on Credit Reporting Bill, Urges Parties to Work Together on Legislation

At its meeting on Wednesday, the Virginia Small Business Commission made no recommendation about whether to support or oppose House Bill 2198, which would affect commercial credit reports in the commonwealth. It did, however, urge both parties in favor of and against the bill to work together to find common ground to address a perceived problem regarding the rights of the subject of a commercial credit report.

NACM has opposed HB 2198 since its introduction and was on hand at the meeting to make the case against the bill's identification provision. This measure would require commercial credit reporting agencies to make the source of a certain piece of information on a commercial credit report known to the subject of that report, if the information was considered "negative," a term the bill fails to define.

Virginia Delegate Michael Watson (R), who originally introduced HB 2198, was on hand at the meeting to make his case in favor of the bill, supported by a number of his colleagues from the House of Delegates. Specifically, Watson framed the bill as fundamentally pro-business and drew comparisons to the rights of consumers as they pertain to accessing and amending their credit reports, arguing that Virginia businesses should have the same rights.

NACM's contingent, comprised of representatives from NACM's membership, affiliate management and national staff, was accompanied by other representatives from the commercial credit reporting community. All of them noted that the bill fails to address what initially drove its introduction: a rash of aggressive and misleading marketing tactics used by a credit monitoring service to scare Virginia businesses into believing they had to pay for a subscription service to fix their company's credit report.

Instead, the bill aims to institute reforms that could threaten the availability of credit information on Virginia businesses, as companies that contribute trade lines and payment data to the commercial credit reporting agencies might stop reporting rather than face identification, and possible retaliation, by their customers. Testimony about this risk provided by NACM South Atlantic COO Anton Goddard and Richmond-area NACM member and Credit Manager Doug Strobel was of particular note to the members of the Commission. They appeared receptive to this concern and it seemed to partially drive their decision to neither endorse nor reject the bill.

Work to find a compromise among all parties concerned will begin immediately, and any resulting new legislation will be considered by the Small Business Commission in the fall. Should the parties be unable to reach an agreement, the Commission will consider HB 2198 again, and either make a recommendation to reject the bill or support its inclusion in the agenda for the commonwealth's next legislative session.

NACM will be monitoring the bill in all its forms throughout and opposing any legislation that could restrict the free and open exchange of credit information. If you have any questions or comments about HB 2198, please contact Jacob Barron, CICP at

- Jacob Barron, CICP, NACM staff writer

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