FCRA Compliance

On October 26th 1970 the US Congress enacted the Fair Credit Reporting Act in short abbreviation FCRA which is a legislation to promote accurate data and privacy when it comes to consumer reports. Although the FCRA was initially enacted to regulate financial institutions that used credit reports, it has also been updated with additional clauses and together with the Fair Debit Collection Practices Act (FDCPA), the FCRA is the fundamental consumer rights law in the United States.

Currently the US FTC (Federal Trade Commission) and the Consumer Financial Protection Bureau are the agencies that enforce the Fair Credit Reporting Act.

Personnelgraph is a Consumer Reporting Agency (in short CRA) as defined by the Fair Credit Reporting Act. In this article we will cover the basics of the FCRA. Personnelgraph is not a financial institution and does not provide credit reports, which is why we will only cover FCRA compliance of pre hiring screening that are also regulated by the FCRA.

FCRA Compliance comes in both ways, one from the Consumer Reporting Agency side, that is us and the other from the employer that uses our services. Both sides must follow FCRA Regulations to be FCRA Compliance. Non FCRA Compliance can result in hefty fines and lawsuit, which is why we built Personnelgraph from the ground up with FCRA Compliance in mind.

FCRA Compliance on the CRA Side

We as a Consumer Reporting Agency do our best to provide accurate data, under the FCRA Regulation, our data cannot be more than 7 years old or in some cases 10 years old, the data must be from legitimate sources and incorrect data must be marked as incorrect. We must also protect our consumer`s data from leaks. Our databases are built with the highest security standard to minimize the possibilities of leaks. Consumers are able to reach our Dispute Department in order to Dispute inaccurate data. If you are a Consumer and would like to Dispute a record, make sure to visit the Disputes page to file a Dispute.

FCRA Compliance on the Employer Side

You as an employer must follow the FCRA Guidelines to avoid penalties.

One of the most important guidelines are:

1. Initiate a Background Check only when you have clear intentions. For example, for Employment Purposes. Do not initiate a Background Check on yourself or on others for no possible legitimate use of the data.

2. Make sure to inform the consumer that you will conduct a pre hire background check. We have all the forms on our website including the rights the Consumers have when it comes to background checks. Make sure to give the proper forms to the Consumer and keep a record of these forms. Personnelgraph does occasional checks to make sure our clients follow FCRA Regulations.

3. Make sure to inform the consumer of Personnelgraph if they would like to file a dispute of their records.

4. If a Consumer has been denied a job opportunity, make sure to inform them that their criminal record has been used as a reason for their denial. Even though Personnelgraph promotes fair job opportunities by offering PostHire Constant Screening for employees with known criminal history, sometimes employers may decide to choose someone else for the job opportunity, in this case make sure to inform the Consumer. If you are a Consumer and would like to file a Dispute, head over to our Disputes page. Those are the basics when it comes to FCRA Compliance. If you would like to review the full law, you can do that by accessing the FTC Website.