The Federal Trade Commission (FTC) recently announced that it is issuing Warning Letters to certain companies who may not be complying with the Fair Credit Reporting Act (FCRA). The Warning Letters stem from FTC non-attorney staff calling a company inquiring about their products and services in order to test their FCRA compliance. The FTC’s press release reads, in part:
FTC Warns Data Broker Operations of Possible Privacy Violations
The Federal Trade Commission sent letters to ten data broker companies warning that their practices could violate the Fair Credit Reporting Act (FCRA) after a test-shopping operation by the FTC indicated the companies were willing to sell consumer information without abiding by FCRA requirements.
The ten companies receiving the warning letters from the FTC include:
- Two companies that appeared to offer “pre-screened” lists of consumers for use in making firm offers of credit: ConsumerBase and one additional company;
- Two companies that appeared to offer consumer information for use in making insurance decisions: Brokers Data and US Data Corporation; and
- Six companies that appeared to offer consumer information for employment purposes: Crimcheck.com, 4Nannies, U.S. Information Search, People Search Now, Case Breakers, and USA People Search.
Don’t be one of those companies. With respect to background checks for employment screening purposes, if you assemble or evaluate information on consumers and provide it to employers so that they can screen or evaluate employees, then you are a consumer reporting agency (CRA) that is required to comply with the FCRA. This is true even if you obtain this information from criminal background checks or other public records.
The Warning Letter to Crimcheck.com can be found by clicking here.
FTC Blog Posting can be found by clicking here.
FTC Press Release can be found by clicking here.