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Two background check firms have agreed to pay $18.6 million to settle three class action lawsuits alleging violations of the federal Fair Credit Reporting Act (FCRA) for “failing to take reasonable measures to ensure the accuracy of background check report provided to prospective employers.” A story by TopClassActions.com about the lawsuits is available at http://www.topclassactions.com/lawsuit-settlements/lawsuit-news/5437-background-check-firms-agree-to-18m-class-action-settlement.
TopClassActions.com reports the two background check firms – both units of risk assessment services provider Verisk Analytics Inc. – were accused “of violating the FCRA by providing incorrect, outdated or incomplete information to potential employers.” The two companies also failed to provide “consumers with copies of their consumer reports before delivering them to prospective employers.” The two defendants have denied all allegations in the class action lawsuits, TopClassActions.com reports.
The FCRA requires Consumer Reporting Agencies (CRAs) – another term for background check firms – “to create policies that are fair and equitable to consumers with regard to the collection, dissemination and use of their consumer and credit information.” The lawsuits allege both companies “fail to use ‘reasonable procedures’ necessary to ensure the ‘maximum possible accuracy’ of the reports they sell” and one failed to notify consumers when compiling and selling a report, TopClassActions.com reports.
The plaintiffs filing the class action lawsuits were seeking a statutory damage award between $100 and $1,000 as permitted under the FCRA, TopClassActions.com reports. ‘Class Members’ would include U.S. residents “who were the subject of one or more consumer reports provided to a third party” by the two companies for employment purposes “which contained a ‘Criminal SuperSearch’ result reflecting an arrest or conviction between April 16, 2010 and Sept. 16, 2013,” according to TopClassActions.com. As part of the settlement, the defendant background firms denied any liability.
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