Background screening providers pay $13 million
Fine Amount:
$2.5 million CMP and $10.5 million in relief
Penalty Type:
Issued by:
The Consumer Financial Protection Bureau has announced it has taken action against two of the largest employment background screening report providers—General Information Services (GIS) and its affiliate, e-Background-checks.com, Inc. (BGC)—for failing take basic steps to assure the information reported about job applicants was accurate. The CFPB is ordering the companies to correct their practices, provide $10.5 million in relief to harmed consumers, and pay a $2.5 million civil penalty.
The companies collectively generate and sell more than 10 million consumer reports about job applicants each year to prospective employers. These consumer reports include criminal history information and civil records, among other types of data. Employers use the consumer reports to determine hiring eligibility of applicants and make other types of employment decisions. GIS is headquartered in Chapin, South Carolina, and BGC is headquartered in Dallas, Texas.
The CFPB found that the companies violated the Fair Credit Reporting Act by:
- Failing to take basic steps to assure accuracy. For example, the companies failed to accurately match public records information with the correct consumer. As a result, the companies provided prospective employers with inaccurate reports that included criminal records attached to the wrong consumers, dismissed and expunged records, and misdemeanors reported as felony convictions.
- Including impermissible information in consumer reports. The companies unlawfully included certain information in consumer reports they provided to prospective employers. Specifically, the CFPB found that the companies failed to take measures to prevent non-reportable civil suit and civil judgment information older than seven years from being illegally included in its reports.
The companies were ordered to provide $10.5 million in relief—approximately $1,000 to each affected consumer; revise their compliance procedures; retain an independent consultant; develop a comprehensive audit program; and pay a civil monetary penalty of $2.5 million.
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