Consumer Financial Protection Bureau Announces New Corrected Forms Required by FCRA for Background Checks Starting January 1 2013

In November 2012, the Consumer Financial Protection Bureau (CFPB) announced in the Federal Register corrections to typographical and technical errors in the earlier versions of three new essential CFPB forms required by the Fair Credit Reporting Act (FCRA) in the background screening process starting January 1, 2013. These forms include ‘A Summary of Your Rights Under the Fair Credit Reporting Act,’ ‘NOTICE TO USERS OF CONSUMER REPORTS: OBLIGATIONS OF USERS UNDER THE FCRA,’ and ‘NOTICE TO FURNISHERS OF INFORMATION: OBLIGATIONS OF FURNISHERS UNDER THE FCRA.’  The CFPB announcement is available at https://www.federalregister.gov/articles/2012/11/14/2012-27581/fair-credit-reporting-regulation-v-correction.

The summary of the CFPB announcement reads as follows:  “Pursuant to the Dodd-Frank Wall Street Reform and Consumer Protection Act (Dodd-Frank Act) and the Fair Credit Reporting Act (FCRA), as amended, the Bureau of Consumer Financial Protection (Bureau) published for public comment an interim final rule establishing a new Regulation V (Fair Credit Reporting) on December 21, 2011. This document corrects typographical and other technical errors in Appendices I, K, M, and N of the interim final rule, which contain model forms.” These corrections are effective November 14, 2012. For more information about the CFPB, visit http://www.consumerfinance.gov/learnmore.

The new CFPB notices were first reported in the ESR News blog ‘Background Screening Firms must Modify Forms Mandated by Fair Credit Reporting Act by January 1 2013’ posted August 9, 2012 by Attorney Les Rosen, Founder and CEO of background check firm Employment Screening Resources (ESR).  Rosen reported that the forms were changed to reflect that consumers could obtain information about their rights under the FCRA from the CFPB instead of the Federal Trade Commission (FTC). The three forms currently in use until January 1, 2013 indicate the FTC is the agency consumers can contact with questions. Rosen wrote that each of the three notices is mandated for use in certain situations under the FCRA:

  • ‘A Summary of Your Rights Under the Fair Credit Reporting Act’ is a notice that a background screening firm must provide to an employer and employers in turn must provide the notice to applicants in different situations.
  • The FCRA also mandates that a background screening firm (known as a Consumer Reporting Agency or “CRA”) must provide each user of its services a ‘NOTICE TO USERS OF CONSUMER REPORTS: OBLIGATIONS OF USERS UNDER THE FCRA.’
  • The ‘NOTICE TO FURNISHERS OF INFORMATION: OBLIGATIONS OF FURNISHERS UNDER THE FCRA’ is aimed at certain furnishers of information to CRAs and must be provided in prescribed situations such as a re-investigation where the consumer disputes the report or in a situation involving identity theft.

Rosen wrote: “The changes are the result of the creation of the CFPB as part of the Dodd-Frank Wall Street Reform and Consumer Protection Act (Pub.L. 111-203, H.R. 4173) that was signed into law by President Barack Obama on July 21, 2010. The CFPB has rule making and enforcement powers over the FCRA. However, the CFPB does not have supervisory power over background screening firms. Congress specifically exempted background screening firms from being supervised by the CFPB since a background check report is not a financial product. The result may be some confusion as the CFPB and FTC determine which agency will perform which tasks.”

The new CFPB forms to be used starting January 1, 2013, as well as the FTC forms currently in use until that date, are available on the ESR Legal Compliance Resources web page at http://www.esrcheck.com/services/research.php. For ESR clients, these new CFPB forms will be updated automatically with the ESR Assured ComplianceSM system. For more information about automated compliance, visit http://www.esrcheck.com/ESR-Assured-Compliance.php. For information about background checks, visit Employment Screening Resources (ESR) – ‘The Background Check Authority’ and nationwide screening company accredited by The National Association of Professional Background Screeners (NAPBS®) – at http://www.esrcheck.com/ or call toll free 888.999.4474.
 
Sources:
https://www.federalregister.gov/articles/2012/11/14/2012-27581/fair-credit-reporting-regulation-v-correction
http://www.consumerfinance.gov/learnmore/
http://www.esrcheck.com/wordpress/2012/08/09/background-screening-firms-must-modify-forms-mandated-by-fair-credit-reporting-act-by-january-1-2013/

About Employment Screening Resources (ESR):

Founded by safe hiring expert Attorney Les Rosen in 1997, Employment Screening Resources (ESR) – ‘The Background Check AuthoritySM’– provides accurate and actionable information that empowers employers to make informed hiring decisions for the benefit of their organizations, employees, and the public. CEO Rosen literally wrote the book on background checks with “The Safe Hiring Manual” and ESR is accredited by The National Association of Professional Background Screeners (NAPBS), a distinction held by a small percent of screening firms. Employers choosing ESR know they have selected an agency meeting the highest industry standards. To learn more about ESR, visit http://www.esrcheck.com or call toll free 888.999.4474.

About ESR News:

The Employment Screening Resources (ESR) News blog – ESR News – provides employment screening information for employers, recruiters, and jobseekers on a variety of topics including credit reports, criminal records, data privacy, discrimination, E-Verify, jobs reports, legal updates, negligent hiring, workplace violence, and use of search engines and social network sites for background checks. For more information about ESR News or to send comments or questions, please email ESR News Editor Thomas Ahearn at tahearn@esrcheck.com. To subscribe to the ESR News Blog Feed, visit http://www.esrcheck.com/wordpress/feed/. To subscribe to the complimentary ESRcheck Report monthly newsletter, please visit http://www.esrcheck.com/Newsletter/.