The Consumer Financial Protection Bureau’s (CFPB) updated Final Rule on the federal Fair Credit Reporting Act (FCRA) Summary of Rights includes such non-substantive changes as corrections to contact information for various federal agencies and eliminating reference to the term “Federal Land Banks,” as well as other technical changes. The last time the FCRA Summary of Rights was updated was 2018. While the new Rule goes into effect April 19, 2023, the compliance date identified is March 20, 2024.
Employers using consumer reporting agencies to conduct background checks and provide reports must be mindful of any changes to the forms used for FCRA compliance. As part of the background check process under the FCRA, an employer may be required to provide a candidate for employment (consumer) the CFPB’s most up-to-date Federal Summary of Rights. For example, whenever an employer provides a consumer a consumer report or investigative consumer report as part of the pre-adverse action process, the consumer should also receive a copy of the most up-to-date federal Summary of Rights.
While the CFPB has provided a new Summary of Rights in light of the updated Rule, it has caused some confusion because it does not appear “perfect” (e.g., contains clerical errors), employers should in any event periodically review the CFPB’s website or check with counsel to determine if a new federal Summary is available.
Although the new Rule appears to be a housekeeping change, the change is a reminder that the FCRA is a technical compliance statute, requiring employers to review processes and forms to ensure every aspect of the process is current to minimize risk of costly litigation.
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