Skip to the main content.
New! Continuous MVR monitoring
Driving record monitoring

Ongoing monitoring of driving records can help employers avoid risk and improve driver safety. Learn about the benefits of adding Verified Credentials' newest solution to your screening strategy.

Read the blog ›

Featured resource

Industry-Trends-Report-01

Learn the latest trends in employment background checks. This report uses real-life usage data to uncover how employers are screening across industries.

Download the full report ›

Verified Credentials is a leading background screening company. Since 1984, we’ve helped validate and secure relationships through the use of our comprehensive screening solutions. We offer a wide variety of background checks, verifications, and innovative screening tools.

Get to know us ›

Accredited background screening solutions

Logo-PBSA-Accreditation-120x98

Our accreditation confirms that our policies, processes, and employee training meet rigorous industry compliance standards.

Learn about our solutions ›

1 min read

$2.7 Million Settlement Preliminarily Approved in FCRA Class Action

The recent preliminary approval of a class action settlement in California highlights the importance of using multiple identifiers in background check matching procedures.

According to the court’s order granting preliminary approval of the settlement, the screening company at the heart of the case “sells credit reports that help automobile dealers manage the regulatory compliance obligations that accompany every consumer car purchase.” One key rule is that car dealers are prohibited from doing business with any specially designated national (“SDN”) identified by the Treasury Department’s Office of Foreign Assets Control (“OFAC”).

The plaintiff claimed the screening company incorrectly reported that he was on OFAC’s SDN list and, as a result, he was wrongfully denied credit to purchase a vehicle in front of his father and sister. He stated that he felt “embarrassed, ashamed, and angry.” The plaintiff requested a copy of his report and learned that a reporting error matched his name with another person identified on the SDN list. The screening company used “only first and last names when checking whether a consumer matches with anyone on the SDN list,” despite the availability of other identifiers, including date of birth and address.

The Lawsuit & Settlement

The plaintiff sued the screening company on behalf of himself and similarly situated consumers, claiming the screening company violated the Fair Credit Reporting Act (“FCRA”) and California’s Consumer Credit Reporting Agencies Act (“CCRAA”) by failing to “follow reasonable procedures to assure the maximum possible accuracy of the consumer information included in its OFAC Check documents.”

On June 1, 2023, the court preliminarily approved the class action settlement. If the court issues final approval, each of the estimated 1,071 class members will receive a $1,000 payment without the need to submit a claim.  Additionally, the screening company would pay:

  • The estimated $44,000 cost to administer the settlement;
  • “Up to $15,000” to the plaintiff for serving as the class representative; and
  • Attorney’s fees to the plaintiff’s attorney “in an amount not to exceed $1,620,000.”

A hearing to decide final approval is set for October 25, 2023.

This case demonstrates the significant impact a credit reporting agency’s matching procedures can have on the reliability of background reports. In addition, it highlights the importance of FCRA compliance.

Employment Fairness Act for Returning Citizens in Prince George’s County, MD

The Prince George's Employment Fairness Act for Returning Citizens is a new law in Prince George's County, Maryland, designed to provide fair...

Read More

Colorado’s Clean Slate Act Goes into Effect

As of July 1, 2024, Colorado’s Clean Slate Act, or Senate Bill 22-099, is officially in effect.This comes in the wake of several other states that...

Read More

Texas Attorney General Forms Privacy Task Force

The Texas Attorney General’s office has recently announcedthe formation of a dedicated task force within its Consumer Protection Division. This task...

Read More

Kaiser Foundation Hospitals FCRA $4M Class Action Settlement

Kaiser Foundation Hospitals or Kaiser Foundation Health Plan (“Kaiser”) have agreed to pay more than $4 million as part of a settlement resolving a...

Read More

Delta Airlines Settles FCRA Disclosure & Authorization Class Action Lawsuit for $2.3 Million

Last updated on 12-1-2023. Employers should be wary of the increasing number of Fair Credit Reporting Act (FCRA) lawsuits brought against them. The...

Read More

Lawsuit Filed for Alleged Background Check Disclosure Violations

Amazon is busy this time of year. But a recent court filing may leave it busier than usual. A prior Amazon employee claims the retailer violated a...

Read More