A recent $2.6 million civil penalty is a testament to this.
In August, the Federal Trade Commission announced that one of the nation’s largest background investigation firms would pay $2.6 million to settle the FTC’s charges that the firm did not take adequate measures to ensure the accuracy of information provided to employers. The company was also barred from continuing its illegal practices.
The FTC’s charges reflect practices that harm job applicants. Charges include that the company:
- Failed to take sufficient steps to ensure that updates to criminal records, such as expungements, were reflected in reports provided to employers.
- Reported the same criminal offense multiple times on a potential employee’s background check
- Reported criminal records that did not belong to the applicant being screened.
Clearly, mistakes like these can unfairly prevent qualified applicants from finding jobs.
How could this happen? It can happen when background investigation firms skip quality control processes.
Automated background check systems that pull records from large, often out-of-date databases, can wind up reporting inaccurate or misleading information. And when there’s no human review, duplicates and preventable mismatches can slip through the cracks.
In April, the National Consumer Law Center issued a report titled “Broken Records: How Errors By Criminal Background Checking Companies Harm Workers and Businesses.”
The 40+ page report describes how typical background investigation processes lead to errors that unfairly – and unlawfully – prevent applicants from being hired.
Specific problematic practices listed by the NCLC are:
- Obtaining information via bulk record purchase, but then failing to update the database
- Failing to verify information obtained through faulty sources
- Failing to use all available information to prevent mismatches
- Lack of understanding regarding criminal justice procedures
Unfortunately, many background investigation firms’ reliance on automated database reporting makes these scenarios all-too-likely.
The good news is that $2.6 million settlements and national reports promote awareness. And awareness of the problem is a step in the direction towards change in the industry – and protection for employers and applicants alike.
Note: Baker-Eubanks does not rely solely on automated databases for criminal record information. Criminal investigation is conducted on-site at county courthouses, where criminal records originate and are stored. Information gathered is then reviewed by our analysts. For more information, please see Our Process.