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Immigration Compliance and Background Screening

FCRA Violations Against Background Screener Results in $18.6 Million Settlement

Posted in Background Check, Criminal History Records

Last month plaintiffs’ counsel filed a Motion for Preliminary Approval of a Proposed Class Action Settlement against two Verisk Analytics companies — Intellicorp Records, Inc. and Insurance Information Exchange, LLC — for alleged violations of the Fair Credit Reporting Act (“FCRA”).  The matter is pending in the United States District Court Northern District of Ohio and the consolidated case number is Case No. 1:12-cv-02288. 

The motion alleges that Intellicorp Records, Inc. (“Intellicorp”), a background screening company, allegedly violated the FCRA.  At issue is its product “Criminal SuperSearch”, which provides “instant” criminal history background checks.  The FCRA allegations against the companies are for violations pursuant to sections 607(b) (accuracy of the report) and 613 (public record information for employment purposes).  The matters involve pre-employment screening and criminal history background checks.  Each of the plaintiffs alleges that Intellicorp violated the FCRA by failing to use “reasonable procedures” necessary to ensure “maximum possible accuracy” of the reports they sell by issuing inaccurate and incomplete reports.  In addition, plaintiffs allege that Intellicorp violated section 613 of the FCRA by failing to notify consumers “at the time” it furnishes and sells a consumer report, as presumably it had failed to maintain strict procedures to ensure its public records information was complete and up to date.  The plaintiffs’ claims involved an expunged record and mis-matched identities.

The settlement provides substantial monetary and non-monetary relief, including cash disbursements totaling $18.6 million and the monetary value of free consumer reports to all Class Members upon request (there are approximately 545,000 class members).  In addition to monetary relief, Class Members are eligible for expedited dispute process and the legal help of Class Counsel for that process.  In addition to monetary and non-monetary relief, Intellicorp agreed to refrain from advertising the Criminal SuperSearch or other similar database products as an “instant” product.  In addition, as a result of the settlement, Intellicorp agreed that it will not make results available for a court records search unless and until a Single County Criminal or other appropriate individualized search is conducted.

Judge James Gwin signed the Preliminary Approval of Class Action Settlement November 25, 2013.  A hearing to decide on Final Approval will take place May 23, 2014.