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 .



The CHC Blog

By Mark Ridgeway 19 Jul, 2017
As a business owner or HR professional you've been there: you’re at the tail end of a particularly difficult hiring process and you’ve finally found the right candidate for the job. It’s easy to say, “Phew! Glad that’s over,” and move forward with finalizing the details.

But before you do, you should really consider ordering a background check on your candidate of choice. Integrating a background check policy can really benefit and protect your company. Here are 5 reasons you should always run a background check:

1. Stronger hires = Saving Money

Don’t just rely on your “gut feeling.” The more you know about the candidate, the better you will be able to assess if he/she is a fit for the position and for your company. Talent acquisition is a struggle in nearly every industry, so make sure that you’re not cheating yourself out of any of the available information before extending an offer.

It’s important to point out that better hires often means less turnover. We know that turnover is typically the number one cost to employers. Save yourself from investing in the wrong employee for the job.

Aside from turnover costs, as was stated in a previous blog post Who Is Stealing From You , we know that upwards of $50 billion annually in cash and inventory is stolen by employees. Does your job candidate have a history of taking extra "perks" from previous employers?

2. Safer Work Evironment
Running a background check on potential employees before officially hiring them can aide in reducing workplace violence. As an employer, you’ve made a commitment to your current employees to operate a safe work environment. Don’t skip this important step in ensuring that safety.

According to the Bureau of Labor Statistics Census of Fatal Occupational Injuries (CFOI), of the 4,679 fatal workplace injuries that occurred in the United States in 2014, 403 were workplace homicides. However it manifests itself, workplace violence is a major concern for employers and employees nationwide.

3.  Better Compliance in State & Federal Regulatory Requirements
A third-party background screening provider with in-house compliance expertise, can help your company properly create a screening solution. This not only satisfies your industry standards, but also state and federal regulatory requirements, which vary from state-to-state and by type of position you are staffing. Utilizing a partner that is a true expert in this field is important for the success of your company.

4.  Decrease the risk of being sued
Making a bad hiring decision can leave you and your company vulnerable to liability. Ordering a background check can help you find patterns in a person’s history. For example, if a potential employee has had multiple discrimination suits against them, you as an employer may be liable should the employee discriminate within your workplace. Being able to sort out candidates with these issues will help decrease the chances of a lawsuit.

5. Verifying Resumes
Does your candidate have the experience they claim? Do they really have the education and the professional licenses that are listed on their resume? A survey from CareerBuilder  of more than 2,500 hiring managers found that 56% have caught job candidates lying on their resumes.

Background checks can help you weed out the people that do not have the skills for the job. It also can help you verify that the candidate’s resume is valid.  Don’t leave yourself vulnerable to these discrepancies.

Requesting a background check for a prospective employee is perfectly within your rights as an employer. These background check reports can hold vital information that is relevant to your hiring decision. You wouldn’t choose to not gather all of the relevant information when making a different business decision, so don’t skimp here either. Take the time to do your homework and you’ll see the results!

More Posts
Share by: