Your credit report contains sensitive Personally Identifiable Information (PII) so, as you can imagine, there are many laws and regulations (Federal, State and/or Local) that govern the release of this information. Here are some of the most important points:
- Credit reports may only be requested for a specific Permissible Purpose. The Fair Credit Reporting Act (FCRA) defines the acceptable reasons for obtaining a consumer credit report and the civil and criminal penalties for not complying with the FCRA.
- In most cases credit reports may only be requested AFTER the consumer has provided signed authorization to the requester giving them permission to obtain a credit report for one specific use.
- The credit bureaus (TransUnion, Equifax, Experian), also called Nationwide Consumer Reporting Agencies, require all End Users of credit reports to undergo an on-site inspection to assure that they are a legitimate business and are not trying to obtain this information for an illegal or unauthorized purpose. The inspection process also examines how prepared an End User is to safely and securely request, maintain and destroy the PII they will receive.
- For these reasons, individuals who run a business out of their home and do not maintain a separate, secure business office are not able to receive consumer credit reports.
- Several states have placed additional restrictions on the use of consumer credit reports. Oregon is one state that specifically restricts the consideration of consumer credit information in most hiring decisions. Employers, here is a summary of credit reporting laws in all 50 states as of March 2013.
- You have rights and protections whenever your credit report is obtained. Consumers, here is a A Summary of Your Rights Under the Fair Credit Reporting Act.
Advanced Reporting will be closed Monday, May 27th as we celebrate Memorial Day with our families and friends and honor those who have died while serving this country.
A new survey conducted by the ORC International for the Consumer Federation of America and VantageScore Solutions shows that many Americans lack a full understanding of what the credit score is, when it is used and how it impacts them. The women surveyed knew more about credit scores than their male counterparts however the men were more skeptical about using credit report agencies. Advanced Reporting offers a seminar on Understanding Your Credit and we are not at all surprised by these results. Read the full report here and contact us if you would like to arrange a seminar or webinar for your organization.
This is one of the most frequent questions concerns we hear from consumers who are diligent about protecting their personal information and credit history.
All personal credit reports are consumer reports as defined by the Fair Credit Reporting Act (FCRA), however not all consumer reports contain personal credit information. This is especially confusing since the federal law protecting consumers and regulating consumer reporting, the FCRA, contains the word “Credit” in the title and many of the consumer disclosures and notifications required under the law are very credit oriented.
Here are a few examples to illustrate the issue (in each case the information is being gathered and prepared by a consumer reporting agency):
- When you apply for an auto loan and your financial institution reviews your credit history that is a Credit Report and a Consumer Report.
- When you apply to rent an apartment and your property manager reviews your credit and criminal history that is a Credit Report and a Consumer Report.
- When you apply for a job and your employer reviews your criminal history and driving record that is a Consumer Report.
- When you apply for a job and your employer reviews your previous job performance obtained by interviewing your professional references that is an Investigative Consumer Report.
Each of the cases above is regulated by the FCRA and other applicable state and local consumer reporting laws.
To put it simply, background checks provide you with data to help you reduce your risks and make better quality decisions.
This information becomes a consumer or investigative consumer report under the federal Fair Credit Reporting Act (FCRA) when it is:
- about an individual, and
- could potentially have a negative impact on that person, and
- is gathered for you by a third party.
Background checks for employment, volunteer and tenant screening purposes are all examples of consumer reports. These reports can contain a single type of information (i.e. a credit report) or they can include information from many sources (e.g. criminal records, employment verification, rental history, education verification, driving records, etc).
The most effective background checks consider the types of risks you face and the decisions you are making and provide you with data targeted to help you make informed risk management decisions.
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Evaluating the Updated I-9
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ACLU suit: Tenant screening company illegally flagged woman
except from KPLU 88.5 NPR by Ashley Gross
The American Civil Liberties Union has filed a lawsuit on behalf of a woman who says her decades-old drug convictions cost her a chance to rent an apartment—a violation of Washington state law. Read the full article here.
By staying abreast of state and local consumer reporting laws in addition to federal regulations and guidance Advanced Reporting offers our clients the most comprehensive and compliance results available. As your risk management partner it is critical that we not only provide complete and accurate information, but that the information you receive is information you can use. Contact us today for a free consultation regarding your current screening practices and our customized screening solutions.