Criminal Records and the Fair Credit Reporting Act
Nearly forty years ago, the Fair Credit Reporting Act was enacted. The FCRA regulates the collection, maintenance, and disclosure of consumer reports by consumer reporting agencies, including public record information (15 U.S.C. Sections 1681 – 1681x).
Section 1681c of the FCRA provides requirements relating to information contained in consumer reports. When a consumer reporting agency produces a copy of a consumer’s report to the consumer or a third-party (such as employers), the consumer reporting agency is required to exclude, among other things, “adverse items of information, other than records of convictions of crimes which antedates the report by more than seven years” (15 U.S.C. Section 1681c(a)(5)). The statute also demands that consumer reporting agencies exclude records of arrest that antedate the report by more than seven years (15 U.S.C. Section 1681c(a)(2)).
Background screening providers have been under attack for reporting inaccurate or outdated information, resulting in fines by the Federal Trade Commission and similar class-action lawsuits.
Recently, HireRight agreed to pay the FTC $2.6 million for inaccurate reporting. When faced with the decision to go to trial or settle in another class-action case, HireRight decided to settle on July 1, 2011 (Smith v. HireRight Solutions, Inc.). HireRight placed over $28 million in the settlement fund for damages to consumers and paid another $15.2 million in attorney fees to the plaintiffs, for a total of $43.6 million, which does not include their own legal defense cost.
HireRight identified 665,318 consumers impacted by its settlement, which likely cost $3.3 million in mailing cost notifications alone, much less the damage to its reputation. These class-action settlements being entered into by industry giants reveal the stark reality facing background screening providers and users of consumer reports who violate FCRA provisions.
Fair Credit Reporting Act Resources
TheExpungedRecord.com’s goal is to help give you a voice, translate and enforce complicated FCRA rules, and most importantly, EMPOWER YOU to take control over your background data.
LinkedIn Hit With Class Action Suit for Alleged FCRA Violations
A proposed class action suit in California claims LinkedIn Corp. violated the Fair Credit Reporting Act (FCRA) through its job reference tool, which allows prospective employers to obtain information about job applicants. According to the suit, LinkedIn can generate reference reports that include the names, locations, and employment history of people who have worked with a job applicant, none of which are verified. As a result, the suit says, “any potential employer can anonymously dig into the employment history of any LinkedIn member, and make hiring and firing decisions based upon the information they gather, without the knowledge of the member, and without any safeguards in place as to the accuracy of the information that the potential employer has obtained.”
Memorandum Opinion: Singleton v. Domino’s Pizza
Denial of Motion to Dismiss FCRA lawsuit brought by delivery driver fired after a negative criminal history background check was obtained by his employer.
FTC to Study Data Broker Industry’s Collection and Use of Consumer Data
The Federal Trade Commission issued orders requiring nine data brokerage companies to provide the agency with information about how they collect and use data about consumers. The agency will use the information to study privacy practices in the data broker industry.
Spokeo to Pay $800,000 to Settle FTC Charges Company Allegedly Marketed Information to Employers and Recruiters in Violation of FCRA
Spokeo, Inc., a data broker that compiles and sells detailed information profiles on millions of consumers, will pay $800,000 to settle Federal Trade Commission chargesthat it marketed the profiles to companies in the human resources, background screening, and recruiting industries without taking steps to protect consumers required under the Fair Credit Reporting Act.