The FTC announced on Thursday that it had reached a settlement with a criminal background report enterprise that was charged with operating as a consumer reporting agency and was not in compliance with the Fair Credit Reporting Act.
Filiquarian Publishing advertised mobile apps purchasable via iTunes and GooglePlay that allowed consumers to conduct a “quick criminal background check for convictions” in certain states. The firm also said that the apps could provide access to thousands of criminal records, allowing employers to conduct searches on potential employees during the hiring process.
The FTC alleged that Filiquarian, CEO Joshua Linsk and Choice Level, a related firm that provided the record data, did not take necessary action to comply with consumer protections under the FCRA, including the implementation of dispute and accuracy safeguards.
Additionally, the FTC alleged in its complaint that both Filiquarian and Choice Level posted disclaimers stating that they were not FCRA-compliant and that their products should not be considered employment or credit screening products. The FTC said that the disclaimers are not enough to avoid compliance with the FCRA because the firm advertised that the mobile apps could be used for employment screening purposes.
The settlement order also prohibits the firms and Linsk from providing a consumer report to an individual they do not believe has a “permissible purpose” to use the report.