ChoicePoint Division Changes Tack By Kim Zetter Wired News
Story location: http://www.wired.com/news/privacy/0,1848,67276,00.html
02:00 AM Apr. 20, 2005 PT
A division of ChoicePoint that conducts background checks for employers and other organizations will begin notifying individuals when it provides damaging personal information about them. The newly announced policy is designed to bring the company into compliance with a federal law that requires such notice in certain cases.
Rapsheets, a Tennessee company purchased by ChoicePoint last year, provides instant criminal background checks to employers and organizations to help them screen workers and volunteers.
On Tuesday, the company sent an e-mail to customers announcing that it is implementing "a new compliance policy." Effective April 25, whenever a customer runs a background search on someone through the Rapsheets database for employment- or volunteer-screening purposes and the search unearths a criminal record for that person, Rapsheets will automatically notify the person and provide him or her with a copy of the background report and the name and address of the organization that requested it.
The move brings the company into compliance with the Fair Credit Reporting Act, or FCRA, which requires background-checking services to either provide employers with the most-current information available from public records or to notify workers and job applicants when they are providing an employer with damaging information about them that is likely to affect their job prospects. FCRA does not require agencies to notify workers and applicants when they are providing an employer with out-of-date information that is unlikely to affect the individual's job prospects.
The law applies only to third-party background-checking services. If an employer conducts a background search on its own -- gathering data from public records directly without using a third-party agency -- then it is not required to notify an employee or job applicant that it has uncovered adverse information about them.
Rapsheets was featured in a recent story about how some background-checking services are not complying with the law.
The law is designed to ensure that companies don't conduct criminal background checks without permission from employees and job applicants, and it allows job applicants and employees to examine and dispute the accuracy of information about them.
ChoicePoint spokesman Chuck Jones said that the Rapsheets move was not a new policy -- despite the e-mail's wording -- but was simply an effort to bring the division into compliance with existing ChoicePoint policy.
"After ChoicePoint acquired Rapsheets (in June 2004), we started transitioning to existing ChoicePoint policies, and this is just part of that process," Jones said.
He added that other divisions of ChoicePoint that offer employment and volunteer background checks, such as ScreenNow and VolunteerSelect, already are in compliance with the notification policy. This would mean, however, that for nearly a year Rapsheets had not had a policy of notifying consumers when it generated reports that produced adverse information about them, despite assurances from ChoicePoint last month that the company was in compliance.
In order to notify consumers and send them a copy of their background report, Rapsheets will require customers seeking a background check to provide Rapsheets with the person's current mailing address before the customer can view the report. The customer must also indicate whether the search is being conducted for employment purposes or for screening a volunteer.
Rapsheets also put resellers -- private investigators and others who use information from Rapsheets to give to employers -- on notice that they are obligated to follow the terms of the FCRA and must provide employers with updated information or inform consumers when adverse information about them is being provided to employers or volunteer screeners.
Beth Givens, founder and director of the Privacy Rights Clearinghouse said Rapsheets was making a good move, although a number of loopholes remain that allow information brokers to avoid providing responsible services.
"It's at least a step in the right direction toward transparency for the subjects of such searches," Givens said. "But there's more work that needs to be done regarding making sure that the results are accurate and up-to-date."
Mike Coffey, president of Texas investigation firm Imperative Information Group, said he believed that Rapsheets and ChoicePoint were taking the easy way out of complying with the FCRA by choosing the option of notifying consumers about criminal reports rather than making sure the background reports they provided employers was up-to-date and accurate.
"The high road would be for them to say, 'We're going to verify anything before we deliver a record to an employer,'" he said. "They're still going to put the onus back on the consumer to make sure that everything is correct."
Coffey said the decision not to provide accurate data would probably cause ChoicePoint more headaches in the long run.
"People are going to start getting these letters and wondering what the heck is going on," he said. "They'll see stuff that's wrong in their reports and they're going to cause grief with employers. And there's going to be a lot more burden on ChoicePoint to respond to consumer complaints."
According to the FCRA, consumers have the right to file a complaint with a background-checking service if they believe information provided about them is incorrect. The service has up to 30 days to investigate the issue and correct the information or explain why it's correct as is.
"A lot of applicants are going to start disputing this information even when it's valid, and ChoicePoint is going to spend a lot of money going back to source records to verify it," Coffey predicted. "And employers who have been acting on this information for all these years are going to start seeing errors in the reports they receive."
Jones said that ChoicePoint's background services conduct 7.3 million background checks a year and "less than one-tenth of 1 percent" have had errors. It's unclear, though, how often consumers have been able to see their background reports in order to check or dispute their accuracy.
Although Jones said his company regularly notified consumers when it provided reports containing adverse information about them to employers, he did not have any numbers immediately available to indicate how many of those notices the company had sent out in the past.
"There are many individuals who have contacted us who have been unable to find work because outdated or inappropriate information has been provided to the employer by the information broker," Givens said.
But Jones said that of the records that have needed corrections in the past, only a small number consisted of "base record" errors -- errors in the actual criminal information.
"A vast majority of those are usually pretty typical things like a misspelled name or a transposed number in a Social Security number, address or a telephone number," he said.
Givens said that even if ChoicePoint and its business divisions do diligently comply with the FCRA from now on, consumers are still at a disadvantage as long as the companies aren't required to notify consumers whenever a database company gives out any information about them, even if it's not related to employment or volunteer screening. The FCRA does not require data brokers to do this.
"This doesn't cover idle snooping," Givens said. "If I have a conflict with my neighbor and I want to dig dirt on him, it can still be done. Or a stalker who wants to find a location of his ex-girlfriend could also use Rapsheet.com and (the company would) not have to notify the girlfriend."
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Associate Professor Fax (713) 743-3927
Political Science Internet: antunes at uh dot edu
University of Houston
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