A District Court judge in New Jersey has ruled that the state can require the three major credit bureaus have to provide credit reports in Spanish as well as English, but the bureaus do not have to make the reports available in 10 languages which was required under state law. A trade group representing the bureaus had sued the state, saying that the state law was pre-empted by the Fair Credit Reporting Act and, if not pre-empted, infringed upon the commercial speech rights under the First Amendment.
The Background: Back in 2019, the New Jersey legislature amended the New Jersey Fair Credit Reporting Act to require credit reporting agencies provide, upon request, disclosures to New Jersey consumers in languages other than English. The amendment put the Director of New Jersey’s Division of Consumer Affairs in charge of which languages — other than English and Spanish — would be on the list. The Director, to date, has not proposed or adopted any regulations to implement the amendments nor has it sought to compel the credit reporting agencies to comply with it.
On the day that amendments were due to go into effect, the Consumer Data Industry Association filed this lawsuit.
The Ruling: Judge Georgette Castner of the District Court for the District of New Jersey ruled that what the state was doing was in the best interests of its residents, given how many individuals in the state are considered to be limited English proficient — the fifth most in the nation.
“… the Court agrees with the State that requiring the translation of credit file disclosures serves the interest of preventing consumer confusion and deception and curbing barriers to financial literacy,” the judge wrote. “… by making credit file disclosures available to limited English proficient individuals in their preferred language, the State can help resolve errors in credit reporting and prevent long-term damage to their financial health.”
The state did not convince the judge that making credit reports in 10 additional languages was needed. For example, the ninth and tenth language requirement would benefit less than 2% of New Jersey residents, Judge Castner noted. “Here, it is unclear on the current record whether requiring disclosures in at least ten additional languages will help a significant number of consumers in the State and is reasonably related to the State’s interest.”
