The Consumer Financial Protection Bureau (CFPB) has taken action against two of the country's largest background screening companies, saying they failed to ensure that the information they provided about job applicants was accurate.
The "serious inaccuracies" reported by General Information Services and its affiliate, e-Background-checks.com, Inc. (BGC), potentially affected consumers’ eligibility for employment and caused harm to their reputations. 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.
“General Information Services and its affiliate failed to take basic steps to provide accurate background screening reports to employers about job applicants,” said CFPB Director Richard Cordray. “Today, we are holding two of the largest companies in this market accountable for cleaning up the quality of their reports.”
10 million per year
GIS and its affiliate, BGC, 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.
The companies are two of the largest background screening report providers in the United States. GIS is headquartered in Chapin, S.C., and BGC is headquartered in Dallas, Texas.
The CFPB found that GIS and BGC violated the Fair Credit Reporting Act by, among other things, failing to employ reasonable procedures to assure the maximum possible accuracy of the information contained in reports provided to consumers’ potential employers.