Errors in Employment Background Checks: Harmful Long-Term Consequences for Individuals: Comments to the Federal Trade Commission

Advocacy Comments

Comments by:
Beth Givens, Director
Privacy Rights Clearinghouse

Presented to President-Elect Obama’s Transition Team:
The Honorable Susan Ness, Professor Peter Swire, Professor Philip Weiser
and staff members of the Federal Trade Commission
as part of their meeting with privacy and consumer advocates
December 16, 2008

The Privacy Rights Clearinghouse’s (PRC) attention was first drawn to the problem of inaccurate and inappropriate data in employment background checks by individuals who contacted our hotline. Consumer-initiated contacts on the subject of employment background checks, including calls to our free hotline and inquiries on our web-based inquiry forms, increased dramatically in the early 2000s, spiking sharply after 9/11. Such inquiries have remained at a high level ever since. The “hits” to our online educational materials on employment background checks increased at an even faster rate and also remain high. (

This led us to track media coverage concerning employment background screening issues (which also increased over time and remains active). In addition, we made two separate FOIA requests of the Federal Trade Commission to obtain complaints filed by consumers against credit reporting agencies (CRAs) concerning background checks (one in May 2005, another in May 2006).

Complaints and observations from each of these sources have been consistent: Subjects of flawed background checks were denied employment, sometimes for years, or they lost jobs at which they had performed successfully, again, sometimes for years. The problems arose from inaccuracies in data reported or the failure of employers and CRAs to follow laws and proper procedures.

It is clear to the PRC that the problems of flawed background checks is not new to the FTC.(1) It is also our belief that this is a critical area of consumer protection that deserves the increased attention of the FTC. Our analysis of FTC data uncovered numerous instances of complaints against the same company for reporting inaccurate data, often concerning criminal activities; failure to follow FCRA requirements for limiting information reported; and difficulty in getting the misinformation corrected.

The PRC conducted an informal survey of the consumers who contacted us concerning employment background checks over a 60-day period. We learned that not even one of these individuals was aware of the FTC’s role in protecting their rights. Furthermore, when the PRC filed its second FOIA request, we received no response for four months, and only did so after considerable prodding.(2) While this is undoubtedly the result of scarce resources, we feel that the urgent social concerns associated with background checks (3) require immediate action.

We would support changing the law to separate background reports from other FCRA concerns, thus giving this matter an opportunity to receive the attention it deserves. At the very least, the law should be amended to prohibit credit history reviews for jobs that do not relate to finance.

We would also support the sharing of enforcement responsibilities with other agencies, for example with the Department of Justice. The Attorney General’s June 2006 Report to Congress on Criminal History Background Checks contains many constructive suggestions for improving the quality of data reported in background reports, and improving reporting standards in the industry in general. . We would be pleased to support the FTC in helping to implement such changes in any way possible.

If the Federal Trade Commission wishes to contact us regarding the situation described in this summary, please contact Beth Givens at bethg ( at ), or as follows:


We acknowledge the efforts of Kathryn Thyret in
conducting this research and preparing this summary.

(1) “…Although the Federal Trade Commission is supposed to enforce statutes governing consumer reporting agencies, it doesn’t monitor companies unless it receives specific complaints about a pattern of illegal behavior. FTC lawyer Clark Brinckerhoff told Wired News that he’d never even ‘had to research the statute related to background checks, because complaints related to it had never come up’ ”. Kim Vetter, “ChoicePoint’s Checks Under Fire”, Wired News, March 23, 2005.

(2) When we eventually received a response, we were denied a fee waiver under 5USC552(a) (4) (A) (iii) which we had been granted for our previous request, and to which we felt entitled. Such response made it difficult for us to complete our research and share our observations with the FTC.

(3) A footnote to the report quotes Representative Gallagher, in introducing a version of FCRA, noting the intention to prevent outmoded information, including criminal records, from being included in Consumer Reports. “I have long been concerned that one derogatory item could “damn a person to the grave,” that an early mistake could haunt him throughout his adult life, and that redemption is in the process of being programmed out of American society”. The Attorney General’s Report on Criminal History Background Checks, (June 2006) ibid., p. 106.