On September 12, the Bureau of Consumer Financial Protection (Bureau) issued an interim final rule updating two model disclosures (summary of consumer rights and summary of identity theft rights) to reflect changes made to the Fair Credit Reporting Act (FCRA) by recent legislation.  Employers must begin using the new disclosure forms by Friday, September 21.

Does This Apply to Me?

Employers should be concerned with FCRA compliance when they utilize a third party to do any of the following in connection with a job applicant or current employee:

1. Check on the applicant’s criminal history
2. Check on the applicant’s credit history
3. Check on an applicant’s driving record
4. Check on an applicant’s educational history
5. Contact or communicate with any job references listed by the job applicant
6. Contact or communicate with the applicant’s prior employer or prior co-workers, or research the applicant’s employment history
7. Conduct any type of background check or investigation regarding the job applicant, including any Internet or “Google” search concerning the job applicant

Employers who use outside investigators for any of the foregoing are required to give specific written notices to the applicant or employee, including a “Summary of Your Rights Under the Fair Credit Reporting Act.” This model form was last updated in 2012.

Why Did They Update the Forms?

In May 2018, Congress passed the Economic Growth, Regulatory Relief, and Consumer Protection Act. To make it harder for identity thieves to open accounts in a consumer’s name, the Act requires credit reporting bureaus to provide consumers fraud alerts and free national security freezes and freeze releases. The Act also requires employers to provide a notice regarding these new security freeze rights whenever the FCRA requires them to provide a copy of a Summary of Your Rights form, as discussed above.

The Bureau’s September 12 interim final rule updates its model disclosure forms and incorporates the new required notices.  

Next Steps

Employers must update their forms by September 21, 2018. Employers can use the new model disclosure forms or a combination of the 2012 disclosure forms along with a summary of the security freeze rights as long as a separate page that contains the additional required information is provided in the same transmittal. For more information and to download the updated forms, click here.