Some of you might have discovered this blog post by searching terms like "background screening" or "background search". If so, you might also get a lot of ads popping up promising the chance to do all kinds of background checks on anyone you want. Some might even entice landlords to check out possible tenants, or encourage employers to make sure applicants are trustworthy enough for a high security position.
These online companies might sound dependable. They might seem reliable. But if they don’t comply with the Fair Credit Reporting Act (FCRA), searches they do for you could be illegal.
A couple of years ago the Federal Trade Commission made a settlement deal with two companies -- Instant Checkmate and InfoTrack Information Systems -- that were selling consumer data illegally.
Why is this so important? The FCRA is a gatekeeper, of sorts. It provides several safeguards to protect people’s private information. It requires a person’s written consent before any searches are conducted. It also gives you the right to dispute the accuracy or completeness of any information in your report, and have the chance to get any mistakes corrected. And one more thing: anyone requesting a background or credit check must have a valid reason for requesting... and they have to prove it.
While it’s an older case, it is a good example of how background checks can go wrong. According to the FTC, Instant Checkmate violated the FCRA because they didn’t require users of their reports to identify themselves or certify why they were seeking the consumer information. By law, if the info is for a job or housing application, the company reporting the information MUST comply with the FCRA. Period. So if you don’t ask, and someone buys the information to be used in a hiring decision, the law is being broken.
The second company, InfoTrack, took things a step further. According the FTC, InfoTrack provided inaccurate information about job applicants, suggesting they were potentially registered sex offenders. Imagine an employer getting that bit of news. Without the FCRA protections, the applicant would not know about the incorrect information and would not have a chance to dispute it. Most likely, this person wouldn’t get the job, and they might never know why.
Using a Consumer Reporting Agency or CRA that complies with the FCRA protects everyone involved, from the applicant to the employer or landlord.