Blog Enforcement Watch December 05, 2019

CFPB Settles FCRA Claims with NY Background Screening Company

On November 22, 2019 the Consumer Financial Protection Bureau (CFPB) announced that it had filed a proposed stipulated judgment in the federal district court in the Southern District of New York that would resolve claims that a New York-based employment background screening company violated sections 605(a), 607(b), and 613(a) of the Fair Credit Reporting Act (FCRA), 5 U.S.C. §§ 1681c(a), 1681e(b) and 1681k(a). The CFPB alleges that the company, which prepares background screening reports on individuals applying for jobs, did not have adequate policies and procedures in place to ensure utmost accuracy of the information it provided to prospective employers.

If approved by the court, the proposed judgment would require that the company pay $6 million in monetary relief to consumers and a $2.5 million civil money penalty to the CFPB.  It would also require that the company implement policies and procedures “to assure maximum possible accuracy” of information conveyed in consumer reports, establish a compliance committee and monitoring program for the next five years to ensure compliance with and adherence to the proposed order, and notify​ the CFPB of any developments over the next 10 years that may affect the company’s ability to comply with the order.