Good Day Argus Clients,

Some of you have recently asked questions regarding FCRA Regulations to ensure compliance. Since FCRA regulations change occasionally, we thought it best to update everyone moving forward. Below is the FCRA guidelines and regulations for your review. PLEASE REVIEW for your protection. A sample release form may be found on our website at www.argus-search.com, where you can copy and paste your logo onto a word document, for your use.

If you have any questions, please don't hesitate to let us know.

What is a Consumer Report and a Consumer Reporting Agency?

The FCRA requirements apply whenever an employer requests a "consumer report" or "investigative consumer report" from a consumer reporting agency. A "consumer report" includes any written, oral, or other communication of any information by a consumer reporting agency regarding a consumer's credit worthiness, credit standing, credit capacity, character, general reputation, personal characteristics, or mode of living which is used as a factor to establish the consumer's eligibility for employment. For purposes of the discussion below, references made to consumer reports include employment reports. A "consumer reporting agency" is any person or company who, for financial gain, regularly engages in the business of assembling or evaluating consumer credit information or other information on consumers for the purpose of furnishing consumer reports to third parties.

Written Disclosure and Authorization Required The FCRA requires any employer intending to obtain a consumer report to first make a clear and conspicuous written disclosure to the applicant or employee that a consumer report may be obtained for employment purposes. The disclosure cannot be included in an employment application or other document that contains additional information. The employer must also obtain the employee's or applicant's written authorization before obtaining the report.

Employer-User Certification Required

Employers also must comply with certain reporting requirements. To obtain a consumer report from a consumer reporting agency, the employer must first provide certification to the consumer reporting agency that the employer:

Is requesting the report for employment purposes (which includes evaluating an applicant or employee for employment, promotion, reassignment, or retention as an employee).

Has provided the required disclosure to the applicant or employee.

Has obtained the necessary written authorization to request the report.

Will provide the applicant or employee with a copy of the report and a written description of the applicant or employee's rights before taking any adverse action based in whole or in part on the report.

Will not use the information from the report in a manner that violates federal or state equal opportunity laws.

Notice Requirements in Connection with Adverse Actions In the event an employer plans to take any adverse action based wholly or in part upon information contained in a consumer report, the FCRA requires the employer to make certain notifications to the applicant or employee.

For employment purposes, an "adverse action" means either: 1) a denial of employment; or 2) any other decision for employment purposes that adversely affects any current or prospective employee. The FCRA requires an employer to provide a copy of the consumer report to the applicant or employee and provide the applicant or employee with a copy of his/her rights under the FCRA (the "Summary of Rights Under the FCRA") before taking adverse action based upon information contained in the consumer report.

After the employer takes adverse action, the employer must provide the applicant or employee with notice of the following:

The name, address, and telephone number of the consumer reporting agency issuing the report A statement that the consumer reporting agency did not make the adverse decision and is not able to explain why the adverse decision was made A statement regarding the applicant or employee's right to obtain a free disclosure of the applicant or employee's file from the agency if the applicant or employee requests the report within 60 days of notice of the adverse action A statement regarding the applicant or employee's right to dispute directly with the consumer reporting agency the accuracy or completeness of any information provided by the agency.

Penalties for Noncompliance FCRA

Employers "negligent in failing to comply" with FCRA requirements are liable to an applicant or employee for actual damages, costs of a suit, and attorney's fees. In addition, an employer's "willful noncompliance," may result in punitive damages. Criminal penalties also may be imposed if a person obtains a credit report under false pretenses.

As always, thank you for your business and have a great day!

Sincerely,

Your Argus Team