LAST REMINDER - Mandatory Revisions of FCRA Background Screening Consumer Notifications Required by January 1, 2013

describe the imageAs a last reminder, the Consumer Financial Protection Bureau (CFPB) recently modified three very important notices required by the Fair Credit Reporting Act (FCRA), and employers and consumer reporting agencies are responsible for replacing each of the existing notices with the new amended versions BEFORE the January 1, 2013 compliance date.   On November 14, 2012, the CFPB released additional modifications to these forms that corrected minor typographical and other technical errors after EBI’s initial notification to our clients and readers.  These modifications are published within the Federal Register for further review.

IMPORTANT:  Employers who previously updated these notices and forms before the November 14, 2012 publication date should review them to ensure compliance with the most current versions. 

PLEASE NOTE:  All applicable notices and forms are now available via EBI’s J-One™ Platform.  Smart Forms and pre-formatted Pre-Adverse Action Notifications have been amended as a courtesy to our clients and will comply with the January 1, 2013 compliance date.

These new CFPB regulations coincide with the Dodd-Frank Wall Street Reform and Consumer Protection Act that was signed into law by President Obama on July 21, 2010. Please note that the Dodd-Frank Wall Street Reform and Consumer Protection Act transferred FRCA-related interpretation and rulemaking authority from the Federal Trade Commission to the CFHB.

While the FTC still maintains supervisory authority over employers, most consumer reporting agencies, and most furnishers of information contained in consumer reports, each of the following forms were revised to direct consumers to obtain information about their FCRA rights from the CFPB instead of the Federal Trade Commission (FTC):

The FCRA requires employers to provide this notice to applicants and employees in a wide variety of situations including but not limited to: (a) when the applicant or employee will be subject to an investigative consumer report, or (b) when a pre-adverse action notice is sent to an applicant or employee. Consumer reporting agencies (EBI) are required to provide this form to all employers AND to the consumer as an attachment with each consumer report.

The FCRA requires that consumer reporting agencies (EBI) provide each employer user with a copy of this notice. This notice contains the rights and responsibilities of the employer who requests consumer reports from EBI.

The FCRA requires that consumer reporting agencies (EBI) provide this notice to certain furnishers of information in specific situations. Please understand the “Notice to Furnishers of Information of their Obligations under the FCRA” only applies to employers that BOTH request consumer reports from EBI AND furnish information contained in consumer reports prepared by EBI.

To ensure compliance with CPFB and effectively eliminate the risk of any potential consumer-initiated litigation, employers must replace each of the existing versions of these documents with the new amended versions BEFORE January 1, 2013.

PLEASE NOTE: Employers should contact their legal counsel for guidance and revise their policies accordingly.  All information contained herein is provided by Employment Background Investigations solely for the convenience of its readers. EBI is not providing legal advice or counsel and nothing provided within should be deemed as legal guidance or advice.  Readers should consult with their own legal counsel to determine their legal responsibilities or if they have questions on any information provided by EBI.