Section 605(a), of the Fair Credit Reporting Act (FCRA) addresses limitations on information contained in consumer reports, more commonly referred to as background check reports or background check profiles. This provision is intended to prevent agencies from reporting outdated information.

This became clear in a recent case from the Ninth Circuit Court of Appeals regarding information that was reported on a background check which ultimately resulted in an applicant being rejected as a tenant in affordable housing. Gabriel Moran, the plaintiff, sued The Screening Pros, the credit reporting agency in this case, because the agency reported information that violated the California Investigative Consumer Reporting Agencies Act (ICRRA).

The issue was a misdemeanor from 2000, a charge that was dismissed in 2004, being included in a 2010 tenant background screening report. As with many cases, there was some back and forth in the case of Moran v. The Screening Pros. The District Court initially decided that the charge could be reported for seven years from the date of said charge being dismissed, however, this was an erroneous decision.

The 1998 amendment to the FCRA changed the language related to reporting, and only allows charges to show for seven years from the date of entry, not from the date of disposition. Since the entry date was 2000, and the case was dismissed, the charge should not have appeared on the report.

As an employer it is important that you understand that by law, information regarding non-convictions may not show on a report if the information is outside of the reporting time limit. Time limits addressed are listed below:

• Bankruptcy – can only show for 10 years from the date of entry of order for relief or the date of adjudication

• Civil Suits, Civil Judgement, Records of Arrest – from the date of entry, seven years or until the governing statute of limitations has expired, whichever is longer

• Paid Tax Liens – seven years from the date of payment

• Accounts placed for collections or charged to profit/loss (charge off) – seven years from the original delinquency date

• Other adverse items other than convictions of crimes (such as arrest records) - seven years from date of entry

Don’t forget other important points in the FCRA including, but not limited to:

• Disclosure forms must be stand-alone documents with no “extraneous” information added. In the case of disclosure forms even state notices are considered extraneous.
• Completed and signed Authorization and Disclosure (A&D) forms must be obtained from the subject before requesting a background report.

• You must give the applicant a copy of the Summary of Rights with the A&D forms. Make sure you are providing the most up-to-date version.

Additional ASE Resources
ASE Background Screening - ASE can protect your organization with our complete background screening services.  We can help you review your current process and make sure you are getting complete information in the most efficient manner.  Contact Susan Chance for more information.