Fair Credit Reporting Act applied to criminal records

The following is a summary of how the Fair Credit Reporting Act (FCRA) applies to criminal background checks, written by Sharon Dietrich of Community Legal Services of Philadelphia.  More detailed information about FCRA’s interpretation and enforcement is available in this 2011 FTC report.  Current information about FCRA’s enforcement as applied to criminal records will appear in the upcoming third edition of Collateral Consequences of Criminal Conviction: Law Policy and Practice.  

Where a criminal record report is provided to an employer by a credit reporting agency (“CRA”), the Fair Credit Reporting Act (“FCRA”), 15 U.S.C. § 1681 et seq, is applicable. See Beaudette, FTC Informal Staff Opinion Letter, June 9, 1998 (available here).  FCRA creates obligations both on CRAs preparing criminal background reports and on employers using them.

Among the duties of CRAs compiling criminal background reports for employers are the following:

  • CRAs may not report arrests or other adverse information (other than convictions of crimes) which are more than seven years old, provided that the report does not concern employment of an individual who has an annual salary that is $75,000 or more.   15 U.S.C. §§ 1681c(a)(5), 1681c(b)(3).
  • CRAs must use “reasonable procedures” to insure “maximum possible accuracy” of the information in the report.  15 U.S.C. §1681e(b).
  • Elements of cause of action: (1) Inaccurate information in report; (2) inaccuracy due to CRA’s failure to follow reasonable procedures to assure maximum possible accuracy; (3) consumer suffered injury (can include emotional injury); and (4) injury was caused by inaccurate entry.  Crane v. Trans Union, 282 F. Supp. 2d 311 (E.D. Pa. 2003)(Dalzell) (citing Philin v. Trans Union Corp., 101 F. 3d 957, 963 (3d Cir. 1996)).
  • A CRA reporting public record information for employment purposes which “is likely to have an adverse effect on the consumer’s ability to obtain employment” must either notify the person that the public record information is being reported and provide the name and address of the person who is requesting the information at the time that the information is provider to the user or the CRA must maintain strict procedures to insure that the information it reports is complete and up to date.  15 U.S.C. §1681k.
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