Consumer Credit Reports - A Brief Review

Being an employer, you may want to use consumer credit reports while hiring new employees and also while assessing them for promotion, reassignment, and retention, but only if you abide by the Fair Credit Reporting Act (FCRA). Sections 604, 606, and 615 of the FCRA clearly mention the employer's responsibilities towards its employees when he uses consumer reports for employment purposes.

The FCRA was primarily constituted to guard the privacy of the consumer report information and to guarantee that the information that is printed on the report by the bureaus and agencies is precise. An amendment was made to the FCRA on 30th Sep 1997 stating that more and more obligations should be imposed on employers who use consumer reports. The Congress advocated this step, as they felt that inaccurate and incomplete consumer reports can cause someone his job or may be even his promotions.

The amendments made it clear that

individuals must be informed that the employer is checking his credit report and more importantly he should agree to it.
individuals have the right to be informed if the information in the credit report has negative influences on employment decision.
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A consumer credit report consists of personal information along with credit characteristics, character, general reputation, and lifestyle. This report should be prepared by a consumer-reporting agency (CRA) according to the FCRA.

Employers feel safe and satisfied to run a background check on applicant before hiring them for the desired job. Some employers are only interested in your credit payment record, some in driving record and some in criminal records. Depending on your job profile, an employer can even ask for an investigative consumer report. These are types of consumer credit reports if acquired from CRA.

For more information on credit reports and identity theft issues, visit - Free Credit Report