THE DMA RELEASES 'PRESERVING OUR CREDIT ECONOMY' BRIEFING Why Reauthorization of the Fair Credit Reporting Act Matters to Consumers and Direct Marketers

NEW YORK, December 5, 2002 – The Direct Marketing Association (The DMA) today released an industry briefing, entitled 'Preserving our Credit Economy: The Fair Credit Reporting Act Reauthorization – Why It Matters to All Direct Marketers." The briefing alerts all of The DMA direct and interactive marketing members and consumers of the potential harm that a lapsing of the state preemption provisions of the Fair Credit Reporting Act (FCRA) could cause if legislation is not enacted within the next 12 months.

The state preemption provisions, which are due to expire in January 2004, would open the door for state and even local politicians to set up a hodge-podge of regulations governing the collection and dissemination of credit information. This potential patchwork quilt of regulations could limit consumers’ ability to receive low-cost credit and other offers. Without these offers remote and over-the-counter retail sales will decline and costs will increase dramatically for all retailers.

It is important to note that changes to the FCRA could also mean that each of the 30,000+ jurisdictions in America could begin determining how individuals’ credit information is handled.

"Every facet of the direct and interactive marketing industry will be harmed if the FCRA is not allowed to remain whole and universally applicable," said H. Robert Wientzen, president & CEO, The DMA. "Protection of our single, nationwide system of collection and dissemination of credit information is key to the way consumers and merchants do business with each other every day. Without it, what would we do, go back to getting letters of reference every time consumers move to a new town or state?"

The 'Preserving our Credit Economy' briefing details the perils marketers and consumers alike face from changes to the FCRA. The changes could give state and local politicians carte blanche to fragment a nationwide system that has given the American consumer unparalleled access to low-cost credit that is the envy of the rest of the world. The DMA briefing includes easily digestible industry overviews for the segments of the American economy most at risk, including obvious ones like banks, and less obvious ones like utilities and even catalog companies who offer credit cards.

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"The net effect of the FCRA's preemption provision's demise could be that some consumers would find their credit more costly, while others might not be offered credit at all," said Wientzen.

"It is imperative that we mobilize and educate the industry quickly on this issue if we are to succeed in preserving our credit economy," said Patricia Faley, vice president, ethics and consumer affairs, The DMA. "The purpose of this briefing is to alert those who may not know they are at risk if FCRA is allowed to be changed, and that includes everyone from consumers to utilities to traditional retailers."

The DMA is the leading and largest trade association for businesses interested in interactive and database marketing, with more than 4,700 member companies from the United States and 53 other nations. Founded in 1917, its members include direct marketers from every business segment as well as the nonprofit and electronic marketing sectors. Included are catalogers, Internet retailers and service providers, financial services providers, book and magazine publishers, book and music clubs, retail stores, industrial manufacturers and a host of other vertical segments, including the service industries that support them. According to a DMA-commissioned study, direct and interactive marketing sales in the United States exceeded $1.7 trillion in 2000, including $110 billion in catalog sales and $28 billion in sales generated by the Internet. The DMA's Web Site is www.the-dma.org and its consumer Web site is www.shopthenet.org.

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