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on September 03, 2014 Human Resources Types of Background Checks FCRA Compliance

Common HR Violations of the FCRA


Despite consumer protections in the form of federal law - the Fair Credit Reporting Act (FCRA) - there are common credit violations that still occur, including inaccurate and outdated reporting. However in the background screening and human resources industry, many of the latest FCRA violations have come from non-credit related information.

It’s a common misperception by employers that the Fair CREDIT Reporting Act only covers ‘credit’. It actually covers many different types of Consumer Reports (Driving Records, Employment Verifications, Education Verifications, Criminal Records, etc).  Those susceptible to violations of the FCRA include the Credit Bureaus, as well as Data Furnishers, Consumer Reporting Agencies (CRA’s), Employers and Landlords.  

Common violations under the FCRA include:

  • Not providing standalone Disclosure and Consent forms to a background check. According to the FCRA, these forms must be separate from any other document. For example, the consent to a background check cannot be included in the actual Application document.
  • Failing to provide the Applicant with a copy of the Summary of Rights Under the FCRA (a copy is available in our Compliance Library)
  • Consumer Reporting Agencies providing and/or Employers basing leasing and hiring decisions on Non-Conviction criminal data that dates back beyond 7 years
  • Failing to follow proper Pre-Adverse and Adverse Action steps when denying a prospective tenant or employee based on information contained in their consumer report.
  • CRA’s failing to adhere to Dispute Resolution processes and timelines outlined in the FCRA
  • Businesses must also be aware if their State has implemented State-specific FCRA regulations (VeriFirst applies a State FCRA data filter to all our consumer reports, helping employers / landlords comply)
  • Employers need to be aware if their State or City have implemented “Ban the Box” regulations. For more info:

Employers can download a copy of “Notice to Users of Consumer Reports” in our Compliance Library. This document clearly defines their obligations under the FCRA.

To ensure that your company is complying with consumer credit reporting and protection laws when obtaining information about consumers, employees, or debtors, the services of a screening and verification provider are ideal. Contact our FCRA certified VeriFirst team to find out how we can meet your business needs.

Compliance Library for Employee Screening

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Ryan Howard

Vice President, Business Development at VeriFirst, a BYL Company

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