The Integrity News
Vol. XIII No. 10
"objective risk management services"
May 17, 2004
In a May 10, 2004 article in the Chicago
Tribune entitled "Online screeners may
miss criminals", investigative reporter
Greg Burns reminds America that "cheap
Web services are often superficial and
trample worker's privacy." He goes on to
point out that "The longstanding Fair
Credit Reporting Act ( FCRA ), for instance,
requires employers to use up-to-date
information for screening job candidates."
His article is just the beginning of what
is about to become a media unveiling of
a national privacy and misrepresentation
scandal that is hurting job seekers and
The reporter might also have quoted governing Federal
law --- FCRA Section 613(a)(2): A report "shall be
considered up-to-date if the current public record status
of the item, at the time of the report, is reported." That
is, if an employer is supplied by a vendor with a report
dated today, to be legal, it must contain what the source
( court, DMV, etc. ) has on file today. This is further
discussed in an
opinion letter from the Federal Trade
Commission ( the agency that enforces the FCRA ) in
a letter dated May 5, 1999, in which the Federal attorney
says in summation of the discussion of this issue:
"Under this standard, an employment screening
service that uses 'stored data' ( which may be as
much as 90 days old ) does not comply with ( FCRA )
Subsection (2)." Data that is retrieved fresh from the
sources daily is the only legal up-to-date alternative.
The reporter should also have pointed out that the
amended FCRA now governs ALL reports on
consumers, not just credit reports.
In addition to it being illegal to make an adverse
employment decision based on data purchased from
the stored data in a commercial database, the Chicago
Tribune article further clarifies the situation with the
"Employers worried about crime, terrorism and
liability are embracing a new breed of online
services for screening job candidates, but these
low-budget background checks don't always check
out." These online services sell stored data that
they have accumulated over time in gigantic
"The cheapest ones routinely fail to identify
criminals, performing such superficial reviews that
serious offenders can get perfectly clean reports."
"Even when these services uncover criminal records,
the information often is incomplete and unreliable."
The reporter then goes on to quote new research
from Criminology Professor Shawn Bushway at the
University of Maryland. The criminal records of
120 parolees in Virginia were checked using a popular
online database background checking company.
Sixty of the parolee names came back with NO
The reporter relates that the Chicago Tribune itself
conducted a study in March, where 10 offenders were
checked, and the online stored data database service
they used found NO criminal records for any of them.
The article says the "the rise of the Internet and
inexpensive computer databases has transformed the
business." The article comments that about 25% of
background checking firms are reputable. The few
reputable firms, like The Integrity Center, Inc., use
ONLY freshly retrieved data and every report they
provide is up-to-date.
The article also tells the reader that "the subjects
must give their ( written ) permission for a background
review and receive copies of any records used in
employment decisions." In fact, there is a little more
than that to the Federal law in the way of
1. There are actually WARNING SIGNS to be aware
of to tell you if a vendor is providing your reports
from aged data stored in a commercial database.
2. It is illegal to knowingly use a background checking
vendor whose reports do not comply with Federal law.
It is also illegal to represent that reports comply with
Federal law when the vendor knows that they do not.
3. If it was legal for employers to use stored data from
commercial databases, it would leave them exposed
because of convictions that may have been recorded
concerning the subject since the database vendor last
updated their records from the particular source. See
the explanation of these
The article in the Chicago Tribune should be hailed as a
great media effort. It sheds a bright light on a serious
fraud that is being committed every week by stored data
commercial database vendors against job seekers and
employers. The rest of the media now need to pick up on
Mr. Burns' leadership, point out the real costs and
problems for employers, point out the harm done to job
seekers, and find out why this fraud is allowed to continue.
The article in the Chicago Tribune in fact should have
been titled: 'Screeners using commercial databases may
miss criminals'. In 2004, the most reputable background
check companies lead the industry with cutting edge
technology that accepts work orders and delivers reports
securely 'online' using encrypted communication.
For additional information about the business risks related
to the purchase of stored data from commercial databases,
which data is then used for adverse employment decisions,
visit the website of The Integrity Center, Inc. and feel free
to call (972) 484-6140 to ask any questions or discuss
any concerns. Helping you with your Risk Management
and HR Automation is what we do.