News & Resources

Federal Trade Commission renews attention to background checks

Aug 21, 2012 Quinn Thomas

Small businesses rely on background checks to ensure they're hiring trustworthy individuals to handle some of their most sensitive information and finances. However, the processes small businesses use to perform such identification checks have been more loosely regulated in the past. Now, though, the Federal Trade Commission is tightening its oversight, The New York Times reports. The federal agency is charging one background check company for violating the Fair Credit Reporting Act, which requires companies to monitor the accuracy of the reports they provide clients with. "For example, the law requires background check companies to notify people in a timely manner when their data is being sent to an employer - so inaccuracies can be challenged - or to ensure that the public record that is being reported is complete and current," the newspaper explains. Small businesses should take the same caution with examining applicants' credit reports. If a score looks low, employers may want to take the time to examine further why it's being reported as such.