Compliance with the Federal Fair Credit Reporting Act

  • By Amber Kruth
  • 30 Sep, 2015
Consumer reports must be compliant with the Fair Credit Reporting Act

Compliance with the Federal Fair Credit Reporting Act

When performing background checks on potential employees, it is essential that you, as the employer, follow the Federal Fair Credit Reporting Act (FCRA). Failure to comply with these regulations may result in a civil lawsuit or even criminal prosecution.

We at Courthouse Concepts are here to guide you through the process and help you stay compliant with state and federal regulations. We are accredited experts in the field of screening services, including pre-employment screening, drug screening, tenant screening, and on-boarding; and our resources are available to you throughout the process.


Here are a few necessary forms to remain compliant with the FCRA:


Authorization/disclosure form

This is a form signed by the applicant prior to running a background check. It has to be a separate form submitted with the application and authorizes the employer to obtain a consumer report.


Pre-Adverse Action Letter

If you are not hiring someone based on his/her consumer report (background check), then a pre-adverse action letter has to be sent to the applicant with a copy of the report and the summary of rights under the Fair Credit Reporting Act.

You can obtain this and other useful forms directly from our site, along with the report and summary of rights. Visit .

If you are one of our website users, the pre-adverse letter, summary of rights and a copy of the report can be sent with a click of a button.


Adverse Action Letter

This is to be sent within five (5) working days after the pre-adverse is sent, giving the applicant five (5) days to call and dispute anything he/she thinks is not accurate. If the applicant disputes his/her consumer report, CourtHouse Concepts is tasked with re-verification of the initial report. During this process, no action should be taken. If no dispute is made, the adverse action letter should be sent, It is also recommended to again send the report and the summary of rights.


For more information on these forms and other screening resources, visit our website at www.courthouse .



Industry News and Trends

By Brittany Guyton 18 Apr, 2016

“Ban the Box” is an international campaign advocating on behalf of ex-offenders, seeking employment. Their goal is to persuade employers to remove the “check box” from hiring records that asks if applicants have a criminal record. Followers of the campaign advocate that this change will allow employers to consider a candidate’s qualifications first, without the stigma of a criminal record.


New York City and Austin Texas are among some of the cities who have recently proposed amendments and ordinances regarding this issues.


The New York City Commission on Human Rights (NYCCHR) recently issued proposed rule amendments regarding the Fair Chance Act. Although this may be a step toward compromise regarding the “Ban the Box” issue, the amendments pose severe compliance challenges for employers. Some potential violations include; 1) Requesting permission to conduct a background check and 2) Using any standard form across multiple jurisdictions that includes a criminal history question regardless of if the form specifies NYC applicants should not respond.


Requiring employers to use a different employment application or form for hiring in NYC creates a significant compliance hurdle that could cost employers thousands of dollars in penalties.

These proposed amendments also prohibit employers from conducting their own search with terms such as “arrest,” “mugshot,” “warrant,” “criminal,” “conviction,” etc. It is unclear if these provisions prohibiting employers from searching for the specified terms or websites are barred from doing so at any point in the hiring process or just prior to extending a conditional offer of employment. These requirements would leave employers without adequate resources to conduct a criminal history search when needed.



A ban the box ordinance was also proposed in Austin, Texas. Although this ordinance is mostly straight forward, there are major concerns regarding a listed requirement to notify applicants in writing if the adverse action decision is based on criminal history.


Employers that conduct background screenings via Consumer Reporting Agencies (CRAs), the Fair Credit Reporting Act (FCRA) requires a specific process to be followed any time an employer is potentially making an adverse decision (i.e., denying employment, terminating an employee, deciding not to promote an individual) based on information contained within a background report – which may or may not contain criminal history information.


Requiring employers to specifically state that the individual’s criminal history is the basis for an adverse decision, extends beyond the federal requirements which presents potential compliance challenges for employers that hire in multiple jurisdictions


Learn more about the Ban the Box campaign and the concerns surrounding it at


Call Courthouse Concepts for detailed, and thorough background screenings!


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