The method used by a Consumer Reporting Agency to assure accuracy of criminal convictions was challenged recently by the Consumer Financial Protection Bureau in a November 22, 2019 ruling $8.5 Million Judgment for FCRA Violation. The result is that the Consumer Reporting Agency alleged to have violated the FCRA has agreed to pay $6 million for the purpose of providing redress to Affected Consumers and pay a civil money penalty of $2.5 million to the Bureau.
IN THE OPINION
As reported on pages 6 and 7 of the opinion:
- Whenever any Consumer Reporting Agency, in particular the Defendant in this case, furnishes a Consumer Report for employment purposes for which it compiles and reports items of information on consumers which are matters of public record and are likely to have an adverse effect upon a consumer’s ability to obtain employment, the Consumer Reporting Agency must either
- Notify consumers in accordance with § 613(a)(1) of the FCRA, 15 U.S.C. § 1681k(a)(1); or
- Maintain strict procedures designed to ensure that whenever public record information which is likely to have an adverse effect on a consumer’s ability to obtain employment is reported it is complete and up-to-date as required by § 613(a)(2) of the FCRA, 15 U.S.C. § 1681k(a)(2); and
- Follow procedures to prevent the reporting of outdated non-conviction adverse items of information, as proscribed by § 605(a)(2) and (5) of the FCRA, 15 U.S.C. § 1681c;
WHAT DOES THIS MEAN?
What happened in this case and why should you be aware of what happened?
Many consumer reporting agencies supplement their criminal convictions searches with a multi-jurisdictional database of criminal convictions. These multi-jurisdictional databases contain criminal convictions from thousands of jurisdictions who report into the database under various formats. These databases should be considered excellent secondary tools to uncover a criminal conviction. They should never be considered a primary source of criminal convictions. And since it is information in a database, versus information at the courthouse level, it could contain outdated or erroneous information. This is why the FCRA outlines the two options above.
The first option above, i.e. notifying the consumer, is not a best practice, in our opinion. It represents an easy way out of doing the work of assuring that the information in the database is correct. Many things can go wrong in the communication process to the consumer e.g. notifying the consumer can be overlooked. This can result in legal actions against the firm procuring the reports from the Consumer Reporting Agency.
The latter option above means assuring the accuracy of criminal convictions by taking measures that the adverse information i.e. the criminal conviction, is up to date. We believe this is a business best practice. This entails confirming that the conviction still exists at the jurisdictional level. This confirmation procedure is important because convictions in a database could have been expunged or could be otherwise inaccurate. There are over 300 million people in the United States. Many have the same name, live in the same county and perhaps even share the same date of birth as others.
We have reported, in a previous blog, the dangers of following a “shortcut” method of merely notifying the consumer of adverse information from a database. In our discussions with companies, many times we are told that the provider is providing criminal conviction very quickly. When we hear this, we know that the screening provider is merely providing information from a multi-jurisdictional database.
OUR PROCEDURES AND PROMISE TO OUR CLIENTS
Randisi & Associates, Inc. is a member of Concerned CRAs, a background check consumer protection group with 200 members and a member of the Professional Background Screening Association. Consumer Reporting Agencies (CRAs) that participate in Concerned CRAs pledge to verify the accuracy of information provided and avoid offshoring Americans’ personal information. We never use databases as a primary source of information.
James P. Randisi, President of Randisi & Associates, Inc., has since 1999 been helping employers protect their clients, workforce and reputation through implementation of employment screening and drug testing programs. This post does not constitute legal advice. Randisi & Associates, Inc. is not a law firm. Always contact competent employment legal counsel. Mr. Randisi can be contacted by phone at 410.494.0232 or Email: firstname.lastname@example.org or the website at randisiandassociates.com