Home > Uncategorized > The FCRA Merry-Go-Round: Worth a specialized lawyer?

The FCRA Merry-Go-Round: Worth a specialized lawyer?

May 27, 2011

In law as in most things, these days it pays to specialize.  As the world grows more complex, the law follows, to the point where lawyers won’t just specialize in litigation, but special kinds of litigation like collections suits, antitrust suits, and so on.

The FCRA is just one statute, and there are around 1000 FCRA lawsuits filed in the entire USA each year.  Is the FCRA worth specialization?

I think so, if only because the FCRA is so quirky.  It was initially made law in 1970, but it has been amended many times since then, and some of the amendments are sloppily drafted.  As a result, it is not the sort of statute that lends itself to casual review.  Here is just one example of a kind of circle or merry-go-round created by the way the statute is written:

When an employer obtains a background report about a potential or current employee, that employee is supposed to get a copy of the report along with the standard disclosures that are provided with all FCRA-regulated reports.  But the FCRA doesn’t make that clear at all, at least not in one place.  Instead, you have to piece together a puzzle, as follows:

1.  When a credit reporting agency creates a report regarding employment, 15 USC 1681b(b)(1)(B) states that the CRA must include with the report a copy of the disclosures mandated under 15 USC 1681g(c)(3).

2.  The reference to 15 USC 1681g(c)(3) is a drafting mistake.  The mandatory disclosures are actually listed at 1681g(c)(1), not 1681g(c)(3).  Hopefully you catch that or you see a footnote about it in some (but not all) references to the disclosure section which are provided in some (but not all) published copies of the FCRA.

3.  Before an employer takes action against an employee based on the report, 15 USC 1681b(b)(3)(A) states that the employer must provide the employee with a copy of the report and a copy of the mandatory disclosures at 1681g(c)(3) (which, again, really means 1681g(c)(1)).

4.  Accordingly, before the employer takes action against an employee based on a background report created by a CRA, the employer must, under 1681b(b)(3)(A), provide the employee with copies of the documents which the CRA gave to the employer pursuant to 1681b(b)(1)(B).

Make sense?  It does once it is pieced together.  But piecing it together is about as fun as doing taxes.  Which, come to think of it, is another specialized area of law.

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