Clients Conducting International Checks Must Ensure Disclosure and Authorization Forms are FCRA Compliant

Several international-based vendors have recently communicated that they will be rejecting disclosure and authorization forms that are not clearly separated, as required under the Federal Fair Credit Reporting Act ("FCRA").

The Federal Fair Credit Reporting Act (FCRA) continues to be a highly litigated area of law. Business Information Group consistently publishes communications regarding requirements under the FCRA, and other state laws involving reporting requirements, to remind clients to review current practices and ensure they are compliant under the law.

Recently, international-based vendors have stated they will no longer be accepting disclosure and authorization forms that are not clearly separated.1 This requirement will apply to international processing requests that (1) are received from an end user based in the United States, or (2) relate to a subject who is located in the United States.

Business Information Group has previously communicated that the FCRA requires employers to (1) make a clear and conspicuous disclosure, in writing, to the consumer, before a report is procured, that a consumer report may be obtained for employment purposes; and (2) obtain a written authorization from the consumer for the procurement of the report. Under Federal Trade Commission (FTC) guidance and language set forth under the FCRA, the disclosure document must consist "solely of the disclosure." This is referred to as the "Standalone Disclosure" requirement, which prohibits inclusion of any extraneous information on the disclosure form. Prior communications can be accessed here: Compliance Alert: Recent Litigation and Settlements Require Updates to FCRA End-User Certification Practices

Federal judges differ on how to interpret the statutory requirements when determining whether a disclosure does, in fact, "consist solely of the disclosure." Generally, courts have determined that the standalone disclosure requirement is violated where the disclosure contains: liability waivers2, notices of FCRA Summary of Rights, state specific background check notices3, and instructions on how to make a request for information4. Additionally, the FTC has published guidelines on what to include in an FCRA disclosure form.

Clients, especially those requesting international checks, are encouraged to review their disclosure and authorization forms to ensure FCRA compliance. Please contact your Account Manager if you have any questions on the standalone disclosure requirement, or would like to request our template form.

Posted: October 11, 2021

1 This requirement is set forth under 15 U.S.C. 1681b(b)(2).

2 Syed v. M-I LLC, 853 F.3d 492 (9th Cir. 2017).

3 Gilberg v. California Check Cashing Stores, LLC (2019), No. 17-16263 (E.D. Ca. January 29, 2019).

4 A recent publication on this case can be accessed here.

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This document and/or presentation is provided as a service to our customers. Its contents are designed solely for informational purposes, and should not be inferred or understood as legal advice or binding case law, nor shared with any third parties. Persons in need of legal assistance should seek the advice of competent legal counsel. Although care has been taken in preparation of these materials, we cannot guarantee the accuracy, currency or completeness of the information contained within it. Anyone using this information does so at his or her own risk.

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