In Williams, Plaintiff Richard Williams instituted a lawsuit against First Advantage Background Services (“First Advantage”) for violating the FCRA.  Williams applied for a job with Winn-Dixie Stores, Inc. (“Winn-Dixie”).  As a part of the job application, First Advantage provided Winn-Dixie with a background check report for Mr. Williams.  The background check prepared by First Advantage, however, included criminal records of an individual named “Ricky Williams”.  Because of the false criminal record information included in the background check report, Winn-Dixie did not offer Mr. Williams the position that he had applied for.  The inclusion of the information by First Advantage was alleged to be a violation of 1681e(b) of the FCRA, which requires companies such as First Advantage to institute policies and procedures to ensure maximum possible accuracy of its reports.  

At trial, the jury returned a verdict in favor of Mr. Williams and awarded $250,000 in compensatory damages as well as $3.3 in punitive damages.  First Advantage appealed the jury’s damage award to the 11^th Circuit.  The 11^th Circuit affirmed the award of the $250,000 in compensatory damages award but reduced the punitive damages award to $3.3 million.  

If you believe you have been subjected to an inaccurate background check report that may have violated the law, it is important to seek the guidance of a skilled FCRA and Consumer Protection Attorney as soon as possible. To schedule a consultation to discuss your situation with one of our attorneys, contact The Kim Law Firm, LLC today by calling 855-996-6342.

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Background Check Consumer Reports are Covered Under the FCRA

The Fair Credit Reporting Act (“FCRA”) regulates how consumer and credit reports are obtained and used. A background check report is a type of consumer report that provides information on a person’s credit history, rental history, criminal history, and sometimes driving history. Landlords wishing to run background checks on rental applicants must comply with all requirements under the FCRA.

The FTC Issues Guidance on Landlord Background Checks

The Federal Trade Commission (“FTC”) recently issued guidance to landlords and background check companies to facilitate a better understanding about requirements under the FCRA. This guidance provides information to clarify the FCRA so that landlords and background check companies can ensure they are taking all necessary measures to comply with the law.

Landlords have a basic understanding of the FCRA when screening tenants, but typically do not review or take time to understand the full provisions of the law. The FCRA requires a landlord to have express and written consent before running a background check on an applicant. Once a landlord is finished with an applicant’s background check report, the landlord must dispose of the report in a secure manner. Further, the landlord cannot use the report for any purpose other than approving or denying an application.

Additionally, under the FCRA, if a landlord takes “adverse action” on an applicant (such as denying the application, requiring a co-signor, or requiring that the applicant pay more in rent than another applicant), the landlord must give notice of that determination. This is referred to as an “adverse action notice.”

When an adverse action notice is required, the landlord must provide the applicant with the name and address of the company that prepared the report, and information on how the report can be disputed. The FTC guidance provides examples for when landlords must give notice to applicants of adverse action. This is the case regardless of whether the background check report played a significant role in the landlord’s decision.

If a landlord has taken adverse action against an applicant without providing the prospective tenant with appropriate notice, then that landlord may be in violation of the FCRA.

Contact The Kim Law Firm, LLC Today to Speak with a Consumer Protection Attorney

If your application for rental housing has been denied or if you simply have questions about the background check process, contact a Consumer Protection and FCRA Attorney at The Kim Law Firm, LLC today by calling 855-996-6342 for a no cost consultation.

The post Tenant Background Checks – What You Should Know About FCRA Requirements appeared first on The Kim Law Firm, LLC.

Is a Web Page a Single Document?

In Martinez v. Sephora USA, Inc., the Honorable Yvonne Gonzalez Rogers of the Northern District of California was confronted with this exact issue: what a single “document” is in the context of an online background check system.  In Martinez, the plaintiff alleged that a web page is a single document – and because of that fact – Sephora’s inclusion of a “certification and release” on the same web page as the background check disclosure violated the FCRA’s “single document” or “solely of the disclosure” requirement. 

However, Sephora argued in its motion for judgment on the pleadings that the “solely of the disclosure” requirement under the FCRA was not violated because the term “solely” is “more flexible than at first it may appear.”  In other words, Sephora argued that the plain meaning of “solely” in the FCRA does not mean what it appears to mean, and other items may be included in the same web page, even if the web page is considered a single document.  The argument of Sephora makes little sense given the plain meaning of the word solely, as well as the certain purpose behind that provision of the FCRA, which is, to ensure that the “disclosure” is obvious and visible so that consumers would immediately know the sensitive information that Sephora would be gaining access to from plaintiff.

The Court ultimately denied Sephora’s motion by determining, among other things, that the question of whether a web page equals a single document under the FCRA to be unclear because a lack of authority cited by either party on the issue.  The Court did determine, however, that if a web page is considered a single document, then Sephora did violate the FCRA by also including a “certification and release” on the same page as the disclosure.

Contact a Consumer Protection Attorney Today

If you did not provide consent for a prospective employer to run a background check, or if you simply have questions about the process, you should consider speaking with a Consumer Protection and FCRA Attorney.  Please contact The Kim Law Firm, LLC today by calling 855-996-6342 to schedule a no-cost consultation to speak with one of our attorneys.

The post Background Check Disclosure Lawsuit – Did Employer Violate the FCRA? appeared first on The Kim Law Firm, LLC.

Consumer Reports

Consumer reports are defined as any written, oral, or other type of communication issued by a consumer reporting agency that contains information concerning at least one of the following:

• Creditworthiness;
• Credit standing;
• Credit capacity;
• Character;
• General reputation;
• Personal characteristics; or
• Mode of living.

Generally, employers who use background checks in their hiring process are required to take steps to:

• Ensure that applicants agree to their consumer reports being used for employment purposes; and
• Notify applicants immediately if information contained in their consumer reports may result in a rejection of their application.

Notice and Authorization

To fulfill these duties, employers must notify applicants in writing before they order a consumer report from an agency. Notice can be included in an application packet as long as it is a separate, clear, and conspicuous document. Employers are further required to obtain the applicants’ or employees’ written authorization before placing an order for a background check.

Adverse Action Notification

When an employer is considering rejecting an application, based either in whole or in part on a person’s background check, he or she is required to notify the applicant by sending a pre-adverse action disclosure. If, within a reasonable amount of time of sending the pre-adverse action disclosure, the employer still wishes to deny employment, he or she must send an official adverse action disclosure containing the following information:

• A copy of the background screening results;
• A copy of the Federal Trade Commission’s (FTCs) document entitled Summary of Your Rights Under the FCRA;
• The name, address, and phone number of the consumer reporting agency who supplied the report;
• A statement explaining that the consumer reporting agency did not make the employment decision;
• A statement about the applicant’s right to dispute the accuracy of his or her background screening results; and
• Notice that the applicant has the right to request a free background check from the agency within 60 days.

Disputes

The FCRA also allows applicants to dispute their results with the original furnisher of the information, if they:

• Identify the disputed information;
• Explain the basis for the dispute; and
• Include supporting documentation as requested by the furnisher.

Furnishers must then conduct a reasonable investigation within 30 days of the request. If the furnisher discovers that the applicant’s consumer report was incomplete or inaccurate, it must notify all consumer reporting agencies that may have obtained the original report.

Penalties

An employer’s failure to adhere to the FCRA can have significant repercussions on employees and applicants. Fortunately, victims can obtain compensation for their losses if they can establish negligence. These costs could include:

• Actual damages up to $1,000; and
• Attorney’s fees.

However, if an employer willfully chose not to comply with the law, victims may also be awarded punitive damages.

An employer’s failure to respect an applicant’s rights under the FCRA can have far-reaching consequences for victims, if you are concerned that your credit report information was used incorrectly or was recorded inaccurately, it is vital to obtain the advice of an experienced attorney who can help protect your rights. Please contact the Kim Law Firm, LLC by calling 855-996-6342 and we will help you set-up an initial consultation.

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