Enacted in 1970, the FCRA was originally designed to help consumers resolve inaccuracies in their credit reports. It was significantly amended in 1996 and again in 2003, with its scope being expanded to include other reports about consumers, including background reports prepared for employment screening purposes.
In 2016, the Federal Trade Commission (FTC) created new guidance for businesses aimed at giving employment background screening companies information on how to comply with the FCRA. The guidance also helps companies understand when their work defines them as a consumer reporting agency under the FCRA.
The FCRA lists a number of permissible purposes for accessing consumer reports, as noted in Section 604(a)(3)A-G.
Accessing an individual’s consumer report can only be done in accordance with the law’s requirements. To access and use a consumer report for other purposes is illegal and subject to criminal penalties