Are you Confident your Screening Company is Reporting Accurate Information?

One of the main purposes and functions of a background screening company is to ensure the information being provided is accurate and compliant with the Fair Credit Reporting Act, also known as FCRA. Another instance has emerged where a background screening company, whose purpose was to provide tenant screening reports to property managers, violated FCRA regulations and were negligent by reporting inaccurate criminal and eviction background information on rental applicants. The negligence resulted in the  FTC imposing a $4.25 million monetary penalty assessed against the background screening company. Ouch!!!

When researching a background screening vendor to not only provide tenant screening services but also employment screening services, it is very important to know the company you are hiring.  It is also critical to research your vendor, so you are confident that they are ethical and provide accurate and verified information. Short of that, it is a “buyer beware” scenario.  Why would you risk hiring a company that violates federal regulations and, in turn, exposing your company to liability?


When researching a company do not be afraid to ask questions

  1.  How long have you been in business?
  2.  What do you do to ensure accuracy?
  3.  Are you compliant with FRCA?
  4.  What are the regulations regarding background reports? (if you hear a bunch of “mumbo-jumbo”, they don’t know)
  5.  Ask for references.

If you know any human resource professionals, it would be worth your while to call them and ask who they use for their employment screening services. Most background screening vendors offer both services. However, the company referenced above only provided tenant screening services. If the company provided employment screening services and violated FCRA regulations, their penalty would most likely be much more severe since there would have been EEOC (Equal Employment Opportunity Commission) violations.

Violating FCRA regulations is serious…. $4.25 million serious. With the strongest suggestion, please know who your background screening vendor is before you use their services. Call us if you need help or have questions.


Tenant Background Report Provider Settles FTC Allegations That it Failed to Follow Accuracy Requirements for Screening Reports | Federal Trade Commission