A hotel brand management company and consumer reporting agency (CRA) have reached a settlement agreement in a class action lawsuit. This agreement addressed how the two companies violated the Fair Credit Reporting Act (FCRA) when supplying and using background checks for employment. The settlement amounts to over $630,000 and will resolve claims by those subjected to consumer reports by the two companies during the claim period.

The Suit

The complaint against the companies revealed that the company violated the FCRA when requesting and using the CRA’s furnished consumer reports. For example, the employer failed to provide potential job candidates with a clear and conspicuous disclosure and written authorization before attempting to procure a consumer report. The company also allegedly failed to provide copies of any report and other required information before taking adverse employment-related actions based on the report.

Against the CRA, the class action makes similar complaints. Under 15 U.S.C. § 1681b(b)(3)(A)(i) -(ii), agencies must provide certain information before taking adverse action based on the contents of a consumer report. The complaint argued how the FCRA states, “in using a consumer report for employment purposes, before taking any adverse action based in whole or in part on the report, the person intending to take such adverse action shall provide to the consumer to whom the report relates . . . a copy of the report[.]”

As such, the suit claimed that the CRA failed to obtain suitable certification from the employer, written authorization, and, when applicable, a pre-adverse action notice. Under the FCRA, CRAs may furnish a consumer report for employment purposes only if the person requesting it certifies that it has complied with paragraph (2) and, when applicable, paragraph (3).

Clarifications

These paragraphs require those using consumer reports to provide suitable disclosure and written authorization for employment purposes. This step is necessary before receiving the report and before taking adverse action due to the information found in it. Allegedly, the CRA provided thousands of consumer reports for the employer without certifying FCRA compliance with the mentioned paragraphs.

In this settlement agreement, both companies maintained that they were innocent of the suit’s allegations. However, they agreed to pay $630,000 into a fund to distribute to eligible individuals.

According to the settlement, impacted individuals can receive a check worth up to $100; members of a subclass of the company could receive up to $200. The case automatically benefits all class members, though anyone may opt-out by May 20, 2024.

Disclaimer:

Information provided here is for educational and informational purposes only and should not constitute as legal advice. We recommend you contact your own legal counsel for any questions regarding your specific practices and compliance with applicable laws.

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Minnesota officials plan to provide thousands of individuals with expungement relief in the coming months. According to the legislation that passed in 2023, these expungements would cover low-level marijuana convictions.

The Minnesota Legislature passed the Adult-Use Cannabis Act and the Clean Slate Act in 2023. The state’s Bureau of Criminal Apprehension has worked on this plan since then. According to the Bureau, they have worked on determining which marijuana records qualify for the legislation’s automatic expungement process. 

The Bureau estimated that 66,000 records for misdemeanor cannabis-related convictions would qualify for automatic expungement. Officials estimated the state could carry out these expungements by August, possibly as early as May. Under the Adult-Use Cannabis Act and the Clean Slate Act, the state would regulate the cannabis market and provide relief to those previously convicted for cannabis-related violations. 

Under these Acts, adults may purchase, possess, and home-cultivate marijuana within certain limits. The law also created a system for the automatic review and expungement of certain non-violent marijuana-related violations. These changes may help improve housing and employment opportunities for individuals with these convictions.

Minnesota created a Cannabis Expungement Board to facilitate these changes. The board reviews these records on a case-by-case basis to determine eligibility for expungement. According to state officials, they have identified over 200,000 felony drug cases that could qualify. Despite this number, not all will be cannabis related.

The Cannabis Expungement Board is still reviewing these cases to determine which are definitively eligible. Under the law, the Board reviews records that do not involve threats, violence, or the use of weapons and disqualifies records that do. Reviewing these cases is expected to be a significant undertaking. As a result, the board intends to employ at least 30 legal professionals dedicated to examining cases to determine eligibility.

Expunging the qualified low-level marijuana convictions would prevent the public from seeing these cases. As such, these records would not appear in background checks for employment or housing. However, the Bureau of Criminal Apprehensions issued a warning for interested parties. The Bureau explained that they cannot notify consumers about their expunged records.

Consumers with eligible convictions can check the courthouse and inquire about the expungement process. Otherwise, individuals can use a public terminal to search for their cases. Those with qualified records should consider running a self-background check. A self-check allows consumers to review the information that employers, landlords, and others see on their reports. Reviewing these records also enables them to make corrections, especially if expunged information still appears on the report.

Background checks don’t have to be complicated. Try running a self background check today and give yourself a head start.

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The Federal Trade Commission (FTC) has released data indicating that consumers reported losing over $10 billion to fraud in 2023. According to the FTC, consumers lost 14% more in 2023 than in 2022, becoming the highest amount lost to fraud thus far. The FTC revealed investment scams saw the most losses at over $4.6 billion for 2023. This loss is 21% more than 2022’s investment scam losses.

Imposter scams resulted in the second largest losses, with individuals losing $2.7 billion. Fraud also proved a significant problem, especially with online shopping, sweepstakes, and job opportunity scams. Due to the many complaints, the FTC has taken several steps in discovering and stopping consumer fraud.

One significant effort the FTC made involved joining with over 100 federal and state law enforcement partners nationwide. This partnership intends to reduce the number of illegal telemarketing calls through Operation Stop Scam Calls, involving over 180 actions that target operations responsible for many of the calls to consumers in the United States.

The FTC also proposed a ban on imposter fraud. The Commission is in the final stages of the rulemaking process, targeting government and business impersonation scams. The FTC also brought several cases against business and investment opportunity schemes. Additionally, the FTC has listened to consumers concerning new forms of fraud in hopes of developing tools to fight them.

The FTC also has a Consumer Sentinel Network database. It uses this database to receive reports from consumers, the Better Business Bureau, industry members, non-profit organizations, and law enforcement agencies. The reports include fraud, identity theft, and complaints concerning other consumer issues. The Commission uses the reports for many of its own law enforcement investigations and shares them with law enforcement professionals. 

Although the FTC is trying to protect consumers from fraud, consumers should also take steps to protect themselves. Some steps consumers can take include the following:

• Protect your personal information, including your Social Security number and account numbers;
• Use strong passwords;
• Only open emails from people you know;
• Monitor your bank statements and credit card statements

These are just a few steps consumers can take to protect themselves. However, consumers must understand that they can become victims without realizing anything went wrong. Anyone suspicious of identity theft or other issues should report their concerns to law enforcement. They should also inform the FTC at IdentityTheft.gov. Another step consumers can take is running a self-background check. Self-checks help consumers find errors in their reports, discover new accounts opened in their name, and identify other fraudulent cases that can harm a person’s reputation.

Click here to run a self background check

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The Small Business Administration (SBA) has announced changes to the loan program’s restrictions concerning an applicant’s criminal history. According to the SBA’s administrator, the federal agency intends to ban the restrictions on those with criminal backgrounds. This decision could benefit those with criminal records who want to start or expand a business. However, interested parties must complete their sentences to qualify for the loan programs.

The new rules by the Small Business Administration would remove most restrictions on loan programs based on an applicant’s criminal record. This change could improve eligibility for SBA loans for millions. The rules also enforce a ban-the-box on SBA loan applications. This change would prevent criminal history questions from appearing on loan applications.

The current eligibility SBA loan requirements often confuse applicants with criminal records, discouraging many from getting a loan. The SBA worked to correct this issue by making it easier for those with criminal records to apply. It also addressed disparities in the system and growth opportunities, especially the detrimental effect on black business owners. 

According to the Congressional Black Caucus (CBC) chairman, the announcement “reflects our shared commitment to supporting Black-owned small business owners and expanding access to capital to Black and underserved communities.” The chairman also commented, “By finally banning the box on SBA loan applications, we are not just changing policy; we are eliminating unnecessary barriers to entrepreneurship, boosting our economy, creating well-paying jobs, and generating Black wealth.”

Many previously incarcerated individuals struggle to obtain work or loans due to discrimination about their criminal history. The Bureau of Justice Statistics conducted a study involving individuals released from state and federal prisons nationwide in 2022. Of these people, Nevada saw roughly 4,500 people fully rejoin the population. The SBA hoped to help those who finished their sentences re-enter the workforce by dedicating $52 billion in “capital, disaster relief, and bonding to small businesses and disaster-impacted communities.”

The Bureau of Justice Statistics ran a similar study concerning 51,500 people released from federal prisons in 2010. According to the Bureau, one-third of released individuals remained jobless at some point in the first four years after release. During this timeframe, employment for released individuals never exceeded forty percent. The new SBA rule could provide opportunities for those interested in starting a business.

It remains uncertain when the SBA loan reforms will take effect. Regardless, anyone interested in starting a business should consider running a self-background check. This check would allow them to correct any errors in their report and prepare to answer any questions about their background.

Click here to run a self-background check to prepare for your next job interview.

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Massachusetts has decided to pardon offenders charged with simple marijuana possession. As announced by Governor Healey, “I am exercising my executive power as governor under the Massachusetts Constitution, subject to approval by the Governor’s Council, to pardon all misdemeanor convictions for marijuana possession on record in our state.”

This is the first state to do so since President Biden decided to grant pardons to federal offenders charged with simple marijuana possession. Though the Governor’s Council approved the pardons and unanimously supported the effort, they voiced questions on the matter. Such questions included concerns about whether this was enough help for those affected by past marijuana laws.

According to the governor, anyone convicted of misdemeanors for possession of marijuana could qualify for the pardon. However, she emphasized that qualified records included those before the day her letter of request reached the council. The Lieutenant Governor also explained what would happen due to the Governor Council’s vote.

Those charged with misdemeanors of possessing marijuana before March 13, 2024, will see their crimes immediately cleared. As such, anyone receiving a pardon will see it done without taking personal action. Anyone who would like a Certificate of Pardon can request one.

The court system will update all charges of marijuana possession to show the pardoned status. This process involves updating records for approximately 70,000 to 100,000 people. As such, the Massachusetts trial court indicated this could take months. Though concerns have arisen, the court did not give an opinion on the pardon plan. Regardless, they are ready to begin updating the records.

The pardons do not remove the charges from an individual’s record. As such, the council voiced concerns about simply marking the records as pardoned. When searching for actions to help affected individuals, Councilor Kennedy asked District Attorney Kevin Hayden for ideas. District Attorney Hayden recommended they consider expungement. Councilor Kennedy has taken this into consideration and also encouraged the council to do more to inform affected individuals about their pardoned records.

Councilor Terrence Kennedy commented on a scenario concerning the pardons. In this example, Councilor Kennedy explained how an individual’s records would still show the pardoned conviction. Despite the information mentioning the pardoned status, most people with marijuana convictions would not know about the changed status.

These pardons are only for simple marijuana possession. As such, they do not apply to other charges made in conjunction with possession, possession with intent to distribute, or any other higher-level charges in marijuana trafficking. According to Governor Healey, the pardon will take effect immediately.

Disclaimer:

Information provided here is for educational and informational purposes only and should not constitute as legal advice. We recommend you contact your own legal counsel for any questions regarding your specific practices and compliance with applicable laws.

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Representatives from Connecticut Governor Ned Lamont’s administration have announced another delay. This delay affects the state’s Clean Slate law, once again preventing its full implementation from taking effect. As such, those hoping for automatic expungements from the Clean Slate law must wait longer.

This delay follows an announcement from three months ago about the law taking effect in January 2024. Had it begun, it would have expunged the misdemeanors and felonies of over 80,000 individuals. According to the representatives, the state has successfully cleared the records of approximately 13,600 people. This effort amounted to roughly 33,000 charges.

Of these 33,000 charges, approximately 30,000 expunged offenses are for misdemeanors, and the remaining are qualifying low-level felonies.

Under the Clean Slate law, offenses qualifying for automatic erasure include:

• Any unclassified (less than one-year imprisonment) or classified misdemeanor after a seven-year wait from the most recent conviction
• Class D, E, or unclassified (less than five years of imprisonment) felonies and any convictions for operating under the influence after a ten-year wait from the most recent conviction
• Have not received convictions of other crimes during this wait period

The automatic expungement applies to offenses with resulting convictions dated on or after January 1, 2020. Furthermore, individuals must complete all sentence requirements to qualify for the automatic erasure. Such requirements may include prison time, parole and special parole, and/or probation.

The state previously estimated that over 80,000 people would qualify for automatic erasures under state law, which would amount to roughly 178,000 offenses. Initially, it should have cleared by the end of January 2024. The data provided by the state shows how it has fallen short of the goal.

The Department of Emergency Services and Public Protection is one of the agencies responsible for rolling out the Clean Slate law. As such, the Department reported details about the delays. According to the Department of Emergency Services and Public Protection, the reasons for the delay include aging data systems and inaccurate data. The state previously thought it had cleared the long-running technology issues after its $8 million information technology upgrades, which finished in December last year.

The Lamont Administration announced that they expect another 65,000 individuals to see their records expunged in the upcoming weeks. The goal is to expunge all qualifying records from January 1, 2000, within the next 12 months. However, many have criticized the progress due to delays in information about the Clean Slate progress and obstacles.

Disclaimer:

Information provided here is for educational and informational purposes only and should not constitute as legal advice. We recommend you contact your own legal counsel for any questions regarding your specific practices and compliance with applicable laws.

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The Department of Justice (DOJ) recently announced its settlement agreement with a private security services provider. This agreement addressed allegations of the provider discriminating against non-U.S. citizens. 

According to the case, the company violated the Immigration and Nationality Act (INA) when verifying employees’ ability to work in the U.S. via the employment eligibility verification (Form I-9) process. As a result of this case, Assistant Attorney General Kristen Clarke of the DOJ’s Civil Rights Division made the following statement concerning the I-9 process:

“Employers cannot restrict the types of documents workers can use to prove their permission to work. The department continues to ensure that all workers, regardless of citizenship, immigration status or national origin, are allowed to present valid documents of their choice to prove their permission to work.”

The DOJ began its investigation in response to a complaint by a lawful permanent resident. The complaint alleged that the employer had required the worker to present a Permanent Resident Card to complete the Form I-9. Further investigation found reasonable cause to believe that one of the employer’s locations in Concord and Fremont, California, engaged in a pattern of unfair documentary practices against lawful permanent residents. This timeframe spanned from Feb. 3, 2020, to Dec. 20, 2021. The DOJ’s investigation further determined that the employer made similar demands for other noncitizens when verifying work authorization.

Under the INA, employers must permit workers to present any combination of facially valid documentation they choose to meet the I-9 identity and work authorization requirements. This practice disregards the employee’s national origin, citizenship, or immigration status. As such, employees may choose any document from List A or any combination of documents from List B or List C to prove their identity and work authorization. 

This practice also means employers must accept the submitted paperwork as long as it appears genuine. In many cases, non-U.S. citizens may possess documentation similar to U.S. citizens. This case included examples of such documents, including unrestricted Social Security Cards and state ID cards.

Under the settlement, the employer will pay $100,000 in civil penalties to the U.S. government. They must also create a back pay fund of $75,000 in compensation for those allegedly affected by the employer’s actions. Furthermore, the employer must provide its personnel with training on the requirements of the INA, review its policies to ensure compliance and accept additional monitoring by the DOJ.

Disclaimer:

Information provided here is for educational and informational purposes only and should not constitute as legal advice. We recommend you contact your own legal counsel for any questions regarding your specific practices and compliance with applicable laws.

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Massachusetts legislators intend to pass legislation prohibiting employers from using credit reports for employment. As such, the Massachusetts House of Representatives recently passed a bill to amend the state’s consumer protection law. The bill is called “An Act Reducing Barriers to Employment Through Credit Discrimination” (H.1434) and will soon undergo review by the Senate. 

If passed into law, H.1434 would address employers’ requests for and acquired reports from consumer reporting agencies. In most cases, it would bar employers from obtaining a report with any bearing on an individual’s “credit worthiness, credit standing or credit capacity.” H.1434 includes background check providers and credit bureaus as consumer reporting agencies. In addition, employers cannot ask applicants or employees any questions about a report’s contents that could involve the above characteristics.

1. 1434 would also bar employers from using credit information for “employment purposes.” This ban includes considering applicants for employment and determining an individual’s suitability for retention, reassignment, or promotion. State law would consider violating these regulations as an unfair trade practice. As such, aggrieved individuals could qualify to recover attorney’s fees, costs, and double damages due to a willful or knowing violation.

The bill also provides some limited carve-outs for certain employers. For example, an employer may request and use a credit report for employment purposes after meeting either of the following conditions:

• Federal or state law, regulation, or the rules of a self-regulatory organization (as defined in 15 U.S.C. 78c(a)(26)) requires an individual to use a consumer report for employment purposes; or
• The position held or applied for by the employee or applicant requires national security clearance.

H.1434 also contains an anti-discrimination provision. This section bars employers from taking adverse action against a person. The bill specified protections for those who have or intend to:

• File a complaint against a violation of the new regulations;
• Testify, assist, give evidence, or participate in an investigation of a violation; or
• Otherwise, oppose a violation of the regulations.

Should the state Senate and governor approve and sign it, H. 1434 may take effect as early as January 1, 2025. The legislation would become the most restrictive provision in the U.S. for credit reports concerning employment purposes. Employers should note that the regulations still allow them to use consumer reports. It applies only to “true credit reports.” For example, the bill does not prevent them from running criminal background checks or motor vehicle record searches.

 Disclaimer:

Information provided here is for educational and informational purposes only and should not constitute as legal advice. We recommend you contact your own legal counsel for any questions regarding your specific practices and compliance with applicable laws.

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Vermont legislators have returned to discuss reforming the state’s existing expungement system. They will also discuss expanding the ability for residents to seal old criminal records. However, this attempt closely resembles a similar measure that Governor Phill Scott vetoed almost two years ago.

Vermont currently offers two methods for individuals to limit or remove access to their criminal records: expungement and sealing. Expunging records effectively eliminates the recorded criminal history, making it appear like it never happened. Sealing removes the record from public access, though certain agencies can still access it when permitted. During a House judiciary committee meeting, legislative counsel Michele Childs referred to criminal history as “all information documenting an individual’s contact with the criminal justice system.”

This new legislation (H.655) expands the list of offenses qualifying for sealing upon petition. It would also shift certain expungeable offenses to sealable. H.655 would also update who can access sealed criminal records and under what circumstances. Under H.655, the current dual process would change almost entirely to sealing criminal records, with few records qualifying for expungement.

The previous bill, H.534, which Governor Scott vetoed, would have expanded the number of offenses qualifying for expungement. Governor Scott explained that he rejected the bill due to several concerns. For example, he worried about expanding eligibility for sealing drug offenses as violent crimes associated with drugs spiked. Finally, Governor Scott commented that it contradicted legislation related to gun safety and the expansion of background checks.

H.655 attempts to follow up on a compromise suggested by the governor to resolve these concerns. Governor Scott announced, 

“To address these concerns, my administration proposed a uniform, simplified system of sealing – rather than erasing – criminal records. This approach would eliminate undue consequences related to housing, job, and education for those Vermonters who are not repeat offenders while also ensuring access for law enforcement and criminal justice purposes as well as for background checks necessary to ensure public safety and security.”

Because expungement makes it as if the records never existed, agencies, landlords, and employers will find it challenging to access expunged convictions. Expunging these records can also pose challenges for law enforcement and government agencies. Though sealed records remain, accessing them has proven difficult. As such, certain circumstances may allow interested parties to access the information. Accessing these records requires specific purposes, such as government-performed background checks.

Though the House has already approved H.655, it still awaits review from the Senate. Its future proves further uncertain, as it also needs the governor’s signature.

Disclaimer:

Information provided here is for educational and informational purposes only and should not constitute as legal advice. We recommend you contact your own legal counsel for any questions regarding your specific practices and compliance with applicable laws.

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Hawaii’s state Senate has considered House Bill 1595 (HB 1595). This bill makes the state responsible for starting the expungement process for some convictions and arrests for minor drug offenses. However, the bill received significant modifications during a hearing with the Senate’s Committee on Judiciary.

The first draft of HB 1595 proposed a process for the state to start the expungement process. This process would apply to criminal records with arrests or convictions for third-degree promoting a detrimental drug. In addition, it would require the Hawaii Criminal Justice Data Center to file biennial reports with the legislature. This requirement would continue until the state finishes expunging all eligible records.

Hawaii decriminalized the possession of marijuana for less than three grams in 2019. As such, the state allows individuals to expunge relevant criminal records in some situations. However, the current law requires these people to start the process, correctly complete it, and afford it. Passing HB 1595 would change this process.

However, the Office of the Attorney General and the Department of Corrections and Rehabilitation opposed the bill. As such, the state Judiciary recommended further study. This decision resulted in the committee’s acceptance of an alternative approach: a pilot program proposed by the Attorney General’s office.

The Attorney General’s office had several concerns about HB 1595. The office explained that the bill promoted a detrimental drug in the third degree. Doing so would remove its status as an offense, but would not remove it from the penal code. Another issue concerned the difficulty of locating individuals eligible for expungement. They argued the challenge came from lack of personal information needed in finding eligible individuals. Finally, the office worried that HB 1595 would apply to those arrested or convicted of possessing Schedule V substances other than marijuana.

The pilot program proposed by the Attorney General’s office would address these concerns. For example, it would define the eligibility to ensure only marijuana records qualified. The program would include individuals charged with marijuana possession under Section 712-1249 HRS. However, their arrest must have concluded in a non-conviction disposition to qualify.

The pilot program has since received the committee’s endorsement. As such, the pilot program would span 14 months with a manageable number of cases. To ensure they work within workable perimeters, the state will limit the pilot program to the island of Hawaii. It remains uncertain whether HB 1595 will move forward after Hawaii completes its pilot program.

Disclaimer:

Information provided here is for educational and informational purposes only and should not constitute as legal advice. We recommend you contact your own legal counsel for any questions regarding your specific practices and compliance with applicable laws.

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