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How Does ScreenStaff Keep You FCRA Compliant?
When your company orders a Consumer Report, it is automatically subject to certain provisions of the FCRA. A Consumer
Report is defined under the Act as "a written, oral or other communication of any information by a consumer
reporting agency bearing on a consumer's credit worthiness, credit standing, credit capacity, character, general
reputation, personal characteristics, or mode of living" used in whole or in part as a factor in establishing
a consumer's eligibility for credit, employment, insurance or other benefits. These are "records only"
type reports and do not include interviews with current or former employers, schools or other institutions, or business
or personal references.
Certain provisions of the FCRA also deal specifically with your responsibilities if you order a category of reports
called Investigative Consumer Reports. An Investigative Consumer Report is that type of report containing information
pertaining to the consumer's character, general reputation, personal characteristics, or mode of living that is
derived through personal interviews with friends or associates of the consumer.
How Is ChoicePoint Affected by the FCRA?
ChoicePoint's companies supply, in addition to other information services, Consumer Reports to its customers.
The following specific types of reports, made by one or more of these companies, fall under the provisions of the
federal Fair Credit Reporting Act:
- Those used to evaluate a consumer's eligibility for credit for personal purposes.
- Those used to underwrite insurance for personal purposes.
- Those used to evaluate a consumer's eligibility for prospective employment.
- Those used to evaluate an employee for retention, promotion or reassignment.
- Those used to evaluate a consumer's eligibility for a license or other benefit granted by a government agency.
- Those used in connection with a business transaction involving a consumer for a benefit used for personal purposes.
- Those used in connection with a court order or subpoena.
- Those used with written authorization from the consumer to whom it relates.
- Those used as a potential investor or insurer.
- Those used in response to state or local child support enforcement agency.
The following are examples of services offered by ChoicePoint companies which are not considered Consumer Reports
and which are not subject to the provisions of the FCRA:
- Reports on firms (including proprietorships, partnerships, corporations or associations).
- Claim reports, and damaged merchandise services.
- Third-party subrogation reports.
- CP Commercial Specialists Reports, Business and Government Services Reports and CDB Public Record Reports.
Report Content Limitations
The FCRA provides that Consumer Reports and Investigative Consumer Reports may not contain adverse information
more than seven years old, EXCEPT that:
- Orders of Relief (bankruptcies) may be reported for ten years;
- arrests, indictments and convictions may be reported for seven years after disposition, release or parole; and,
- there are no limitations on reporting adverse information when a face amount of $150,000 of life insurance,
or a credit transaction of at least $150,000, or a job paying at least $75,000 per year is involved.
Customer Requirements
When you order Consumer Reports or Investigative Consumer Reports you must certify the following to ChoicePoint:
- the purpose for requesting the report and use the information only for that purpose.
- that you will comply with the disclosure requirements of the FCRA (including adverse action provisions).
- that the information will not be used to violate any federal or state Equal Employment laws or regulations.
- that Consumer Reports or Investigative Consumer Reports will not be ordered for retention or promotion purposes
without the consumer's authorization.
Pre-Notification
If you order Consumer Report, pre-notification MAY be required. Any time a Consumer Report is ordered for EMPLOYMENT
PURPOSES, or an Investigative Consumer Report for ANY purpose, you must notify the consumer that such a report may
be made and will include information as to his/her character, general reputation, personal characteristics and mode
of living.
A Consumer Report notice must:
- be in writing, mailed or otherwise delivered to the consumer (e.g., notice may be provided via your application
form; for EMPLOYMENT PURPOSES ONLY you may not include the notice via your application form because a stand-alone
document is required);
- be issued before the request for a consumer report; and,
- provide written authorization before the request of a Consumer Report.
An Investigative Consumer Report notice must:
- be in writing, mailed or otherwise delivered to the consumer (e.g., notice may be provided via your application
form; for EMPLOYMENT PURPOSES ONLY a stand-alone document is required).
- be issued not later than 3 days after the report was requested
- include a statement that, upon written request, additional disclosure will be made concerning the complete nature
and scope of the investigation (the information must be provided within five days of receiving such a request
from a consumer).
- provide a written summary of the consumer's rights as prescribed by the Federal Trade Commission.
Post-Notification
When you deny (or increase the charge for) a benefit, either in part or in whole, because of information in
a Consumer Report or Investigative Consumer Report from a consumer reporting agency, you must notify the consumer
of that fact and provide him/her with the following:
- copy of the report- EMPLOYMENT PURPOSES ONLY
- description in writing of the consumer's rights to obtain a free report within 60 days to dispute any inaccuracies
with the consumer reporting agency;
- reporting agency's name, address and telephone number
- a statement claiming that the consumer reporting agency did not make the adverse decision and can not provide
the reason for the adverse decision
- notification to the consumer of the adverse action which can be orally, in writing or electronically delivered.
ChoicePoint has established consumer disclosure units to make it easier for consumers to receive copies/information
contained in Consumer Reports. For insurance disclosure, call 1-888-497-0011. For credit disclosure, call 1-800-270-3435
call and employment disclosure, call 1-800-845-6004
State Laws
Several states have passed legislation similar to the federal FCRA and those provisions covering your responsibilities
as a customer are quite similar to those included in the federal law. However, a few states have different pre-
and post-notification provisions that must be used with consumers in those states. Please check with your legal
counsel for analogous state statutes that may affect your business.
The FCRA amendments of 1996 above pre-empted analogous state legislation in the following areas:
- Time frames and notification procedures in cases of disputed accuracy (See, section 611).
- Duties required of those who take adverse action (See, section 615 (a) and (b)).
- Obsolescence periods under section 605.
- Consumer disclosure form and substance.
- Prescreening of Consumer Reports
- Duties required of those who use reports in certain transactions not initiated by the consumer.
Civil Liability
Failure to comply with FCRA requirements imposes civil liability which includes:
- An individual who knowingly obtains a report without a permissible purpose or under false pretenses is liable
to the consumer for actual damages with a minimum penalty $1,000.
- Any entity who willfully fails to comply with a provision of the FCRA is liable to the consumer for actual damages.
The penalty has a minimum of $100 and a maximum of $1,000.
- Negligent noncompliance of FCRA requirements may result in liability to the consumer of actual damages, costs
and attorney's fees.
- Attorney's fees are available to the prevailing party
in defending motions brought in bad faith or for harassment
purposes.
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