All users of consumer reports must comply with all applicable regulations, including regulations promulgated after this notice was first prescribed in 2004. Information about applicable regulations currently in effect can be found at the Consumer Financial Protection Bureau’s website.

Notice to Users of Consumer Reports: Obligations of Users Under the FCRA

The Fair Credit Reporting Act (FCRA), 15 U.S.C. §1681-1681y, requires that this notice be provided to inform users of consumer reports of their legal obligations. State law may impose additional requirements. The text of the FCRA is set forth in full at the Bureau of Consumer Financial Protection’s website. At the end of this document is a list of United States Code citations for the FCRA. Other information about user duties is also available at the Bureau’s website. Users must consult the relevant provisions of the FCRA for details about their obligations under the FCRA.

The first section of this summary sets forth the responsibilities imposed by the FCRA on all users of consumer reports. The subsequent sections discuss the duties of users of reports that contain specific types of information, or that are used for certain purposes, and the legal consequences of violations. If you are a furnisher of information to a consumer reporting agency (CRA), you have additional obligations and will receive a separate notice from the CRA describing your duties as a furnisher.

1. Obligations of all Users of Consumer Reports

   1. Users Must Have a Permissible Purpose 

      Congress has limited the use of consumer reports to protect consumers’ privacy. All users must have a permissible purpose under the FCRA to obtain a consumer report. Section 604 contains a list of the permissible purposes under the law. These are:

      • As ordered by a court or a federal grand jury subpoena. Section 604(a)(1);
      • As instructed by the consumer in writing. Section 604(a)(2);
      • For the extension of credit as a result of an application from a consumer, or the review or collection of a consumer’s account. Section 604(a)(3)(A);
      • For employment purposes, including hiring and promotion decisions, where the consumer has given written permission. Sections 604(a)(3)(B) and 604(b);
      • For the underwriting of insurance as a result of an application from a consumer. Section 604(a)(3)(C);
      • When there is a legitimate business need, in connection with a business transaction that is initiated by the consumer. Section 604(a)(3)(F)(i);
      • To review a consumer’s account to determine whether the consumer continues to meet the terms of the account. Section 604(a)(3)(F)(ii);
      • To determine a consumer’s eligibility for a license or other benefit granted by a governmental instrumentality required by law to consider an applicant’s financial responsibility or status. Section 604(a)(3)(D);
      • For use by a potential investor or servicer, or current insurer, in a valuation or assessment of the credit or prepayment risks associated with an existing credit obligation. Section 604(a)(3)(E); and
      • For use by state and local officials in connection with the determination of child support payments, or modifications and enforcement thereof. Sections 604(a)(4) and 604(a)(5).

      In addition, creditors and insurers may obtain certain consumer report information for the purpose of making “prescreened” unsolicited offers of credit or insurance. Section 604(c). The particular obligations of users of “prescreened” information are described in Section VII below.

   2. Users Must Provide Certifications

      Section 604(f) prohibits any person from obtaining a consumer report from a consumer reporting agency (CRA) unless the person has certified to the CRA the permissible purpose(s) for which the report is being obtained and certifies that the report will not be used for any other purpose.

   3. Users Must Notify Consumers When Adverse Actions Are Taken

      The term “adverse action” is defined very broadly by Section 603. “Adverse actions” include all business, credit, and employment actions affecting consumers that can be considered to have a negative impact as defined by Section 603(k) of the FCRA – such as denying or canceling credit or insurance, or denying employment or promotion. No adverse action occurs in a credit transaction where the creditor makes a counteroffer that is accepted by the consumer.

      1. Adverse Actions Based on Information Obtained From a CRA

         If a user takes any type of adverse action as defined by the FCRA that is based at least in part on information contained in a consumer report, Section 615(a) requires the user to notify the consumer. The notification may be done in writing, orally, or by electronic means. It must include the following:

         • The name, address, and telephone number of the CRA (including a toll-free telephone number, if it is a nationwide CRA) that provided the report;
         • A statement that the CRA did not make the adverse decision and is not able to explain why the decision was made;
         • A statement setting forth the consumer’s right to obtain a free disclosure of the consumer’s file from the CRA if the consumer makes a request within 60 days; and
         • A statement setting forth the consumer’s right to dispute directly with the CRA the accuracy or completeness of any information provided by the CRA.

      2. Adverse Actions Based on Information Obtained From Third Parties Who Are Not Consumer Reporting Agencies

         If a person denies (or increases the charge for) credit for personal, family, or household purposes based either wholly or partly upon information from a person other than a CRA, and the information is the type of consumer
         information covered by the FCRA, Section 615(b) (1) requires that the user clearly and accurately disclose to the consumer his or her right to be told the nature of the information that was relied upon if the consumer makes a
         written request within 60 days of notification. The user must provide the disclosure within a reasonable period of time following the consumer’s written request.

      3. Adverse Actions Based on Information Obtained From Affiliates

         If a person takes an adverse action involving insurance, employment, or a credit transaction initiated by the consumer, based on information of the type covered by the FCRA, and this information was obtained from an entity
         affiliated with the user of the information by common ownership or control, Section 615(b) (2) requires the user to notify the consumer of the adverse action. The notice must inform the consumer that he or she may obtain a disclosure of the nature of the information relied upon by making a written request within 60 days of receiving the adverse action notice. If the consumer makes such a request, the user must disclose the nature of the information not
         later than 30 days after receiving the request. If consumer report information is shared among affiliates and then used for an adverse action, the user must make an adverse action disclosure as set forth in I.C.1 above.

   4. Users Have Obligations When Fraud and Active Duty Military Alerts are in Files

      When a consumer has placed a fraud alert, including one relating to identify theft, or an active duty military alert with a nationwide consumer reporting agency as defined in Section 603(p) and resellers, Section 605A(h) imposes limitations on users of reports obtained from the consumer reporting agency in certain circumstances, including the establishment of a new credit plan and the issuance of additional credit cards. For initial fraud alerts and active duty alerts, the user must have reasonable policies and procedures in place to form a belief that the user knows the identity of the applicant or contact the consumer at a telephone number specified by the consumer; in the case of extended fraud alerts, the user must contact the consumer in accordance with the contact information provided in the consumer’s alert.

   5. Users Have Obligations When Notified of an Address Discrepancy

      Section 605(h) requires nationwide CRAs, as defined in Section 603(p), to notify users that request reports when the address for a consumer provided by the user in requesting the report is substantially different from the addresses in the consumer’s file. When this occurs, users must comply with regulations specifying the procedures to be followed,
      which will be issued by the Consumer Financial Protection Bureau and the banking and credit union regulators.

   6. Users Have Obligations When Disposing of Records

      Section 628 requires that all users of consumer report information have in place procedures to properly dispose of records containing this information. The Consumer Financial Protection Bureau, the Securities and Exchange Commission, and the banking and credit union regulators have issued regulations covering disposal. The Consumer
      Financial Protection Bureau regulations.

2. Creditors Must Make Additional Disclosures

   If a person uses a consumer report in connection with an application for, or a grant, extension, or provision of, credit to a consumer on material terms that are materially less favorable than the most favorable terms available to a substantial proportion of consumers from or through that person, based in whole or in part on a consumer report, the person must provide a risk-based pricing notice to the consumer in accordance with regulations prescribed by the Consumer Financial Protection Bureau. 

   Section 609(g) requires a disclosure by all persons that make or arrange loans secured by residential real property (one to four units) and that use credit scores. These persons must provide credit scores and other information about credit scores to applicants, including the disclosure set forth in Section 609(g)(1)(D) (“Notice to the Home Loan Applicant”).

3. Obligations of Users When Consumer Reports are Obtained for Employment Purposes

   1. Employment Other Than in the Trucking Industry

      If the information from a CRA is used for employment purposes, the user has specific duties, which are set forth in Section 604(b) of the FCRA. The user must:

      • Make a clear and conspicuous written disclosure to the consumer before the report is obtained, in a document that consists solely of the disclosure, that a consumer report may be obtained;
      • Obtain from the consumer prior written authorization. Authorization to access reports during the term of employment may be obtained at the time of employment;
      • Certify to the CRA that the above steps have been followed, that the information being obtained will not be used in violation of any federal or state equal opportunity law or regulation, and that, if any adverse action is to be taken based on the consumer report, a copy of the report and a summary of the consumer’s rights will be provided to the consumer; and
      • Before taking an adverse action, the user must provide a copy of the report to the consumer as well as the summary of consumer’s rights (The user should receive this summary from the CRA.) A Section 615(a) adverse action notice should be sent after the adverse action is taken.

      An adverse action notice also is required in employment situations if credit information (other than transactions and experience data) obtained from an affiliate is used to deny employment. Section 615(b)(2).

      The procedures for investigative consumer reports and employee misconduct investigations are set forth below.

   2. Employment in the Trucking Industry

      Special rules apply for truck drivers where the only interaction between the consumer and the potential employer is by mail, telephone, or computer. In this case, the consumer may provide consent orally or electronically, and an adverse action may be made orally, in writing, or electronically. The consumer may obtain a copy of any report relied upon by the trucking company by contacting the company.

4. Obligations When Investigative Consumer Reports are Used

   Investigative consumer reports are a special type of consumer report in which information about a consumer’s character, general reputation, personal characteristics, and mode of living is obtained through personal interviews by an entity or person that is a consumer reporting agency.

   Consumers who are the subjects of such reports are given special rights under the FCRA. If a user intends to obtain an investigative consumer report, Section 606 requires the following:

   • The user must disclose to the consumer that an investigative consumer report may be obtained. This must be done in a written disclosure that is mailed, or otherwise delivered, to the consumer at some time before or not later than three days after the date on which the report was first requested. The disclosure must include a statement informing the consumer of his or her right to request additional disclosures of the nature and scope of the investigation as described below, and the summary of consumer rights required by Section 609 of the FCRA. (The summary of consumer rights will be provided by the CRA that conducts the investigation.);
   • The user must certify to the CRA that the disclosures set forth above have been made and that the user will make the disclosure described below; and
   • Upon the written request of a consumer made within a reasonable period of time after the disclosures required above, the user must make a complete disclosure of the nature and scope of the investigation. This must be made in a written statement that is mailed or otherwise delivered, to the consumer no later than five days after the date on which the request was received from the consumer or the report was first requested, whichever is later in time.

5. Special Procedures for Employee Investigations

   Section 603(x) provides special procedures for investigations of suspected misconduct by an employee or for compliance with Federal, state or local laws and regulations or the rules of a self-regulatory organization, and compliance with written policies of the employer. These investigations are not treated as consumer reports so long as the employer or its agent complies with the procedures set forth in Section 603(x), and a summary describing the nature and scope of the inquiry is made to the employee if an adverse action is taken based on the investigation.

6. Obligations of Users of Medical Information

   Section 604(g) limits the use of medical information obtained from consumer reporting agencies (other than payment information that appears in a coded form that does not identify the medical provider). If the information is to be used for an insurance transaction, the consumer must give consent to the user of the report or the information must be coded. If the report is to be used for employment purposes – or in connection with a credit transaction (except as provided in regulations issued by the banking and credit union regulators) – the consumer must provide specific written consent and the medical information must be relevant. Any user who receives medical information shall not disclose the information to any other person (except where necessary to carry out the purpose for which the information was disclosed, or a permitted by statute, regulation, or order).

7. Obligations of Users of "Prescreened" Lists

   The FCRA permits creditors and insurers to obtain limited consumer report information for use in connection with unsolicited offers of credit or insurance under certain circumstances. Sections 603(1), 604(c), 604(e), and 614(d). This practice is known as “prescreening” and typically involves obtaining a list of consumers from a CRA who meet certain pre-established criteria. If any person intends to use prescreened lists, that person must (1) before the offer is made, establish the criteria that will be relied upon to make the offer and grant credit or insurance, and (2) maintain such criteria on file for a three-year period beginning on the date on which the offer is made to each consumer. In addition, any user must provide with each written solicitation a clear and conspicuous statement that:

   • Information contained in a consumer’s CRA file was used in connection with the transaction;
   • The consumer received the offer because he or she satisfied the criteria for credit worthiness or insurability used to screen for the offer;
   • Credit or insurance may not be extended if, after the consumer responds, it is determined that the consumer does not meet the criteria used for screening or any applicable criteria bearing on credit worthiness or insurability, or the consumer does not furnish required collateral; and
   • The consumer may prohibit the use of information in his or her file in connection with future prescreened offers of credit or insurance by contacting the notification system established by the CRA that provided the report. The
     statement must include the address and toll-free telephone number of the appropriate notification system. 

   In addition, the Consumer Financial Protection Bureau has established the format, type size, and manner of the disclosure required by Section 615(d), with which users must comply. The regulation is 12 CFR 1022.54.

8. Obligations of Resellers

   1. Disclosure and Certification Requirements

      Section 607(e) requires any person who obtains a consumer report for resale to take the following steps:

      • Disclose the identity of the end-user to the source CRA;
      • Identify to the source CRA each permissible purpose for which the report will be furnished to the end-user; and
      • Establish and follow reasonable procedures to ensure that reports are resold only for permissible purposes, including procedures to obtain:
        1. the identify of all end-users;
        2. certifications from all users of each purpose for which reports will be used; and
        3. certifications that reports will not be used for any purpose other than the purpose(s) specified to the reseller. Resellers must make reasonable efforts to verify this information before selling the report.

   2. Reinvestigations by Resellers

      Under Section 611(f), if a consumer disputes the accuracy or completeness of information in a report prepared by a reseller, the reseller must determine whether this is a result of an action or omission on its part and, if so, correct or delete the information. If not, the reseller must send the dispute to the source CRA for reinvestigation. When any CRA notifies the reseller of the results of an investigation, the reseller must immediately convey the information to the consumer.

   3. Fraud Alerts and Resellers

      Section 605A(f) requires resellers who receive fraud alerts or active duty alerts from another consumer reporting agency to include these in their reports.

9. Liability for Violations of the FCRA

   Failure to comply with the FCRA can result in state government or federal government enforcement actions, as well as private lawsuits. Sections 616, 617, and 621. In addition, any person who knowingly and willfully obtains a consumer report under false pretenses may face criminal prosecution. Section 619.

The Consumer Financial Protection Bureau website has more information about the FCRA.
 

Citations

Citations for FCRA sections in the U.S. Code, 15 U.S.C. § 1618 et seq.:

FCRA Administration Program

At End-User’s request, End-user may elect to have CSI administer pre-adverse and adverse action letters. End-user acknowledges that at all times, complying with the adverse action requirements under the FCRA are solely the responsibility of the End-User, regardless of its participation in the FCRA Administrative Program. Based on program enrollment in writing, CSI will manage the administration of sending pre- adverse and adverse action letters to consumers on behalf of End-User based on the following guidelines and in accordance with the FCRA.

FCRA Administration Program End-User Requirements:

1. End-user must provide an electronic copy of their logo for creation of pre-adverse and adverse action letters.
2. End-user must notify CSI to request distribution of pre-adverse and adverse action letters to consumer.
3. End-user must notify CSI to request distribution of adverse action letter after receiving the results of a reinvestigation if End-user still intends to take adverse action against the consumer.
4. All notifications must be via email at compliance@creativeservices.com.
   • All notifications must include consumer’s (i) Name and Address; and (ii) specific notice of state where consumer resides and state will consumer will be working.

FCRA Administration Program Process:

1. End-user notifies CSI of pre-adverse action via email at compliance@creativeservices.com
2. End-user receives email confirmation that request was received and will be processed within three (3) business days.
   • CSI sends consumer (i) Pre-adverse action letter; (ii) Copy of consumer report;
     (iii) FCRA Summary of Rights; and (iv) State Specific Summary of Rights/Notices (if applicable).
3. CSI sends an electronic copy of pre-adverse action letter to End-user.

If applicant does not dispute information in the consumer report within five (5) business days (unless otherwise required by law), CSI sends consumer: (i) Adverse action letter; (ii) Copy of consumer report; (iii) FCRA Summary of Rights; and (iv) State Specific Summary of Rights/Notices (if applicable).

If applicant disputes information in the consumer report, CSI’s Compliance Department will notify End-user of dispute, process reinvestigation, and deliver results of reinvestigation to End-user and consumer.

• After reviewing reinvestigation results, End-user must notify CSI if End-user still intends to take adverse action and to request distribution of adverse action letter;
• CSI sends an electronic copy of adverse action letter to End-user;
• CSI retains copies of all letters in consumer’s file; and
• CSI maintains an electronic log of all FCRA actions.

DCJIS Model CORI Policy

This policy is applicable to the criminal history screening of prospective and current employees, subcontractors, vendors, volunteers and interns, professional licensing applicants, rental or leased housing applicants, and state, county, and municipal employees and applicants as those terms are defined in M.G.L.c.268,§1.
Where Criminal Offender Record Information (CORI) and other criminal history checks may be part of a general background check for employment, volunteer work, licensing purposes, or the rental or leasing of housing, the following practices and procedures will be followed.

1. Conducting CORI Screening

   CORI checks will only be conducted as authorized by the DCJIS and MGLc.6,§.172, and only after a CORI Acknowledgement Form has been completed.

   A CORI acknowledgement form shall be completed on an annual basis for checks submitted for any other purpose, provided, however, that the requestor has adopted the language from the DCJIS CORI Acknowledgment Form that notifies individuals that their CORI may be requested at any time within the one year that the acknowledgment form is valid. If the requestor has not adopted the DCJIS CORI acknowledgment form language, then it must ensure that an acknowledgement form is completed for each and every subsequent CORI check.

2. ACCESS TO CORI

   All CORI obtained from the DCJIS is confidential, and access to the information must be limited to those individuals who have a "need to know". This may include, but not be limited to, hiring managers, staff submitting the CORI requests, and staff charged with processing job applications. The University of Massachusetts must maintain and keep a current list of each individual authorized to have access to, or view, CORI. This list must be updated every six (6) months and is subject to inspection upon request by the DCJIS at any time.

3. CORI TRAINING

   An informed review of a criminal record requires training. Accordingly, all personnel authorized to review or access CORI at The University of Massachusetts will review, and will be thoroughly familiar with, the educational and relevant training materials regarding CORI laws and regulations made available by the DCJIS.
   Additionally, if The University of Massachusetts is an agency required by MGLc.6,s.171A, to maintain a CORI Policy, all personnel authorized to conduct criminal history background checks and/or to review CORI information will review, and will be thoroughly familiar with, the CORI Policy.

4. Use of CORI in Background Screening

   CORI used for employment purposes shall only be accessed for applicants who are otherwise qualified for the position for which they have applied.

   Unless otherwise provided by law, a criminal record will not automatically disqualify an applicant. Rather, determinations of suitability based on background checks will be made consistent with this policy and any applicable law or regulations

5. Verifying a Subject's Identity

   If a criminal record is received from the DCJIS, the information is to be closely compared with the information on the CORI Acknowledgement Form and any other identifying information provided by the applicant to ensure the record belongs to the applicant.

   If the information in the CORI record provided does not exactly match the identification information provided by the applicant, a determination is to be made by an individual authorized to make such determinations based on a comparison of the CORI record and documents provided by the applicant.

6. Questioning a Subject About His/Her Criminal History

   In connection with any decision regarding employment, volunteer opportunities, housing, or professional licensing, the subject shall be provided with a copy of the criminal history record, whether obtained from the DCJIS or from any other source, prior to questioning the subject about it. The source(s) of the criminal history record is also to be disclosed to the subject.

7. Determining Suitability

   If a determination is made, based on the information as provided in section V of this policy, that the criminal record belongs to the subject, and the subject does not dispute the record's accuracy, then the determination of suitability for the position or license will be made.
   Unless otherwise provided by law, factors considered in determining suitability may include, but are not limited to, the following:

   1. Relevance of the record to the position sought;
   2. The nature of the work to be performed;
   3. Time since the conviction;
   4. Age of the candidate at the time of the offense;
   5. Seriousness and specific circumstances of the offense;
   6. The number of offenses;
   7. Whether the applicant has pending charges;
   8. Any relevant evidence of rehabilitation or lack thereof; and
   9. Any other relevant information, including information submitted by the candidate or requested by the organization.

   The applicant is to be notified of the decision and the basis for it in a timely manner.

8. Adverse Decisions Based on CORI

   If an authorized official is inclined to make an adverse decision based on the results of a criminal history background check, the applicant will be notified in accordance with DCJIS regulations 803 CMR 2.18, 2.19, 5.14, 11. The subject shall be provided with a copy of the organization's CORI policy and a copy of the criminal history (unless a copy was provided previously). The source(s) of the criminal history will also be revealed. The subject will then be provided with an opportunity to dispute the accuracy of the CORI record. Subjects shall also be provided a copy of DCJIS' Information Concerning the Process for Correcting a Criminal Record.

9. Secondary Dissemination Logs

   All CORI obtained from the DCJIS is confidential and can only be disseminated as authorized by law and regulation. A central secondary dissemination log shall be used to record any dissemination of CORI outside this organization, including dissemination at the request of the subject.