When you enlist the services of a background screening partner you assume the reports they send back are accurate and compliant with the law. That is a fair assumption, but it’s not always a safe one to make.
The Consumer Financial Protection Bureau (CFPB) has been pursuing screening companies and fining some of them millions of dollars for providing unacceptable data. The alleged violations include failing to have procedures in place to ensure consumer reports are as accurate as possible, improperly dealing with information that could have an adverse impact on the subject and reporting information that should have been excluded from the reports.
When you hire a background screening company it is essential for you to understand what they are doing behind the scenes to ensure Compliance, Quality and Consistency. There are simple questions you can ask that will help you make sure that your screening partner is providing a quality product without putting your company at risk.
The number of laws and regulations that apply to the background screening industry are mind-boggling. But there are three big ones from the Fair Credit Reporting Act that have come into play during the CFPB investigations.
The first (Section 607(b)) requires screening companies to use reasonable procedures to assure maximum possible accuracy of the information in their reports. Problems in this area are easy to see when you are dealing with applicants with common names. For example, how many Bob Smiths do you think will turn up in a national search? How do you know if the Bob Smith who is applying for a job is the same Bob Smith with a violent felony record? How far do you need to go to make sure you are not labeling an innocent man as a violent offender?
Very few things in this world are 100% accurate, and sometimes it is really difficult to get the right information on these reports. A responsible screening company will have very defined procedures for creating a report, and specifically for dealing with people with common names. The process includes finding additional identifiers such as date of birth, addresses, middle names and social security numbers. There is a clear step by step process for insuring reported information is from the right person. But as we mentioned, mistakes happen. When there is a dispute, the screening company should have a process to record discrepancies and get the root of the problem. Without the steps to report and check, there is no way to review your process and improve. A reputable company will be able to spell out their auditing procedures and show you how they work to improve their results.
The CFPB has also fined companies for including non-reportable information in their consumer reports (Section 605(a)). The FCRA puts time limits on some items that will show up on background checks. Non-conviction criminal information can be reported up to seven years from the date of charge. Not only do background screeners need to follow the FCRA guidelines on this, but there are state laws as well. Add all of that to the hiring company’s guidelines and you can see why it is so important to sit down with your screening partner and make sure you are only considering information that is legally reportable.
When it comes to reporting information that could adversely affect a job applicant there are two ways to go about it (Section 613). The first is to just report everything you find and let the applicant report any discrepancies. The other is to take the time to sort it all out. That includes following strict name matching protocols and sending people to courthouses to make sure they find the most up to date information including final dispositions.
A strong screening company will have all of the following:
- Strict procedures for compiling a consumer report that do not allow employees to use their own discretion. This can include using software to identify discrepancies.
- Documentation of any discrepancies or disputes, including tracking the outcomes.
- Quality Control Measures to look at the discrepancies and disputes to get to the root of any problems.
- Regular internal reviews of the Quality Control Measures.
- Continuous training for employees who compile the reports
Don’t be afraid to ask these questions. The right screening partner will be happy to walk you through their procedures. If they won’t, it’s time to look elsewhere.