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Cannabis Dispensary Settles Class-Action Lawsuit for FCRA Violations

The Florida-based dispensary violated Fair Credit Reporting Act (FCRA) pre-adverse action requirements.

Plaintiffs in the case argued that they were denied employment due to the employer's background check process. According to the Plaintiffs, the employer never provided them with a pre-adverse action notice, a copy of their consumer report, and their summary of rights under the FCRA. The class-action suit states that this mistake denied potential employees their right to review the report and either dispute the results with the consumer reporting agency (CRA) or provide a consumer statement.

The employer settled the class-action suit to the amount of $60,500, spread across approximately 1,000 qualified class members.

In February, a similar class-action lawsuit was filed against a large home improvement company, alleging that the company failed to provide applicants with a copy of their consumer report or a written summary of their FCRA rights before denying employment.

Employers running background checks should ensure compliance with the hyper-vigilant pre-adverse requirements of the FCRA, which include adverse action notices, a copy of the consumer report, and a summary of the consumer's rights under the FCRA. They must also provide an adequate period of time - typically a minimum of five business days - before finalizing the adverse action.

Business Information Group's Consumer Care Portal allows for the streamlined delivery and tracking of consumer compliance notifications and complies with FCRA and state-level requirements for pre-adverse and final adverse action. The portal also provides tools that allow the consumer to dispute the accuracy of their report or add a consumer statement as permissible by the FCRA. For more information on how BIG can help your company comply with FCRA requirements, please contact your account manager or sales executive.

Posted: August 9, 2022


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