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Are Background Checks Ever Not Consumer Reports?

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Are background checks ever not considered a consumer report? Yes, if created in connection with an investigation into suspected misconduct relating to employment.

In the case Mattiaccio v. DHA Group, Inc., the plaintiff asserted three counts against the employer relating to the Fair Credit Reporting Act. A recent opinion in the case brought up a rarely discussed type of background check – one that’s not considered a consumer report and therefore not subject to the regulations of the FCRA. The exception for this type of background check is that the motivation must be borne from a misconduct investigation.

The defendants in this case argued that the background check in question, which occurred post hire, was initiated because of an investigation into the employee’s alleged misconduct surrounding the fact he was “far less than candid” in disclosing his background to his employer. The plaintiff argued the background check was performed in retaliation of a complaint he had lodged.

In this particular case, the court did not grant summary judgment for the defendant, deciding that the “genuine motivation” for the background check was not clear. 

However, this argument is relevant to any employer who finds itself on the receiving end of an FCRA lawsuit wherein the circumstances for the background check were motivated by an internal investigation. This case validates that courts will consider the argument.