International Coffee Bean & Tea LLC Hit With Class Action Suit for FCRA Violations

THE COFFEE BEAN & TEA LEAF LOGOOn May 21st, International Coffee Bean & Tea LLC (Coffee Bean) was hit with a proposed class action alleging violations of the Fair Credit Reporting Act (FCRA) for failing to adequately inform prospective employees about its background check policies, including the procurement of consumer reports.


According to the complaint filed April 10th, the plaintiff had been working for Coffee Bean as a barista when she applied for a promotion in October 2011. The complaint states that, as part of the application, Coffee Bean conducted a background check on the plaintiff, which included obtaining her consumer report without notifying the plaintiff or obtaining her consent.

Coffee Bean, according to the plaintiff, “has a policy and practice of failing to provide adequate written disclosures to applicants and employees, before procuring consumer reports or causing consumer reports to be procured.”


The plaintiff seeks to represent a class of prospective employees who applied to Coffee Bean within the past two years and did not receive proper disclosure by the company to obtain their credit report.


Miceli v. International Coffee & Tea LLC, No. 2:15-cv-03865 (C.D. Cal., May 21, 2015)

Part 2 of Series: Selecting a Background Screening Company: Establishing Criteria

Infographic  Small for White Paper 2015

Part 1 of our series explored the red flags in selecting a background screening company in order to avoid costly litigation. Part 2 of the process involves knowing  the positive attributes that your vendor should have:


  • Accreditation: The National Association of Professional Background Screeners (NAPBS) offers an Accreditation program to background companies in which, much like ISO standards, the company develops and documents their policies and procedures relating to Data Information and Security, Legal Compliance, Client Education, Researcher and Data Standards, Verification Service Standards, and Miscellaneous Business Practices.  Accreditation should be considered a minimum selection criterion, especially considering the risks of litigation. Only 10 percent of background screening companies have earned NAPBS Accreditation.  CARCO is one of them. No employer should risk accepting services from a company who cannot or will not achieve Accreditation.


  • Key personnel: Experienced staff with wide ranging and deep skill sets can make the difference between success and failure of a company… and a background partnership.  Look for a company whose key personnel are active in professional associations and are not only experienced, but have complementary skills including knowledge of the background industry, applicable local, state and federal law, compliance, systems and system integration, process improvement, customer and candidate service, and human resource issues.


  • System Capabilities: When evaluating prospective background providers’ systems, you should look for proprietary systems in which the background provider has committed investment and the ability to integrate with your existing systems.  Determine whether the provider’s system is built on a true rules-based workflow engine that is capable of creating a secure, paperless process and presents an easy to follow workflow for both your candidates and your staff.  To avoid becoming a litigation target, you should ensure that the systems, workflows, and processes employed by your provider assist in maintaining compliance with the ever changing legal environment.


  • Client and candidate facing resources: Simply stated, a background screening partner should make your job (and your candidate’s job) easier and provide the tools to help you assess further opportunities to improve.  These resources include quality, actionable information, the systems mentioned above, standard, custom and ad hoc reporting, and, most importantly, the consultative partnership to help you achieve your goals.  In evaluating prospective providers, ask to see sample reports, both individual and management reports.  Ask to see the online resources available both to the line management administering your program internally and to your candidates.  Establish hours of service, not only to your staff, but to your candidates.  You should insist on a 24 x7 help desk because most of your candidates will be filling in applications and forms after hours.  Determine if the prospective provider has the ability to efficiently reach out to candidates when clarification is needed and if they have the ability to track and manage that outreach.  Ask if the provider has the ability to benchmark and if they are willing to host roundtable events including other clients similar to you to explore ways to make your programs more effective, or to deal with changing legal or regulatory issues. 


  • Data security: Data security and protection of your candidates’ and employees’ PII has never been more challenging and more critical than it is today.  There are basic questions that should be asked.  Does the provider have a data security (and business continuity) plan?  Part of that plan should include regular intrusion testing by an independent company and a code review to look for and repair vulnerabilities.  Data should not only be encrypted when accessed remotely, but should be encrypted at rest.  Evaluate the physical security of the network.  Who has access?  Is it private and proprietary, or does the provider share the servers of a public host who may serve multiple background companies licensing their software?  Is the processing and/or network storage in the U.S. or perhaps in a less secure environment? Compare how data is backed up, and what the latency of that backup is.  You should compare how quickly service could be restored in the event of a catastrophic failure of the main storage site.  Question the password policy and how frequently passwords are expired.  Internal threats to data security are often overlooked.  Be sure to evaluate the prospective background providers own background policy and whether they have an effective internal security awareness training program for their own staff to guard against data theft through carelessness or social engineering.  It is recommended that you visit at least the primary processing and network storage facilities to perform an onsite assessment if possible.


  • Research philosophy: The background provider you select should be willing to stand behind the report they deliver.  To do that, the background provider should perform original, contemporaneous research at original source providers and verify that the information to be reported is relevant, accurate, up to date, and legally compliant when it is reported.  Question how databases might be used and question that use if reports are generated from unverified databases.  Many courts offer remote online access to index information that is often incomplete.  While it is sensible to take advantage of these indices for preliminary research, question the extent to which information from online sources is validated or verified.  Do not accept “name match only” results or incomplete records.  The same position holds true for employment or education verifications.  It is possible that an initial adverse result might be obtained from a source clerk who was rushed, careless or unaware of supplement records.  Ensuring that adverse results are re-verified reduces exposure to claims of unfair hiring practices due to reliance on faulty background reports, and preserves good candidates thereby shortening hiring cycles!


  • Litigation history: It has been said that the best predictor of future behavior is past behavior.  In evaluating prospective background providers, ask if they have ever been the subject of an FCRA violation investigation by the federal regulator, The Federal Trade Commission (FTC), or the Consumer Financial Protection Bureau (CFPB). Ask if they, or any company acquired by them, have ever been or is now involved in litigation regarding an alleged FCRA violation. Once you have the facts, you can determine if you would be at risk with that provider or be best served by a background screening provider with a better record.  


Selecting a background screening provider is not a simple task, and the stakes are high.  There is risk to the company and its employees and shareholders if the background screening program is deficient. It should not be assumed when reviewing pricing proposed in response to an RFP that you are seeing a true “apples to apples” comparison.  The wrong decision can be very costly both in monetary terms and in reputational damage. Be prepared to evaluate quality and organizational fit to assess the long term cost of your relationship with a background provider.  Those who persist in chasing pennies in the selection phase will be feeding dollars to plaintiff’s bar in the future.

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Dollar Tree Hit with Class Action Lawsuit for Background Check FCRA Violations

Dollar Tree LogoThe flurry of class action lawsuits continues.  On May 18th, plaintiffs filed a proposed class action against Dollar Tree Stores, Inc. (Dollar Tree) for allegedly violating the Fair Credit Reporting Act (FCRA) by failing to adequately inform prospective employees about their background check procedure for obtaining consumer reports.

According to the complaint, Dollar Tree failed to properly disclose in a separate document that it would obtain prospective employees’ consumer reports as part of their background checks. The complaint states that the absence of a single document, solely for the purpose of procuring consumer reports is a violation of the FCRA and “flies in the face of unambiguous case law and regulatory guidance from the FTC.”

Walker v. Dollar Tree Stores, Inc., No.8:15-cv-01170(M.D. Fla., May 18, 2015)

Ohio to Ban the Box on Applications for State Government Positions

bantheboxAs of June 1, 2015, Ohio is “voluntarily” joining the Ban the Box Movement and removing the question on government job applications regarding the applicant’s criminal history.


The move comes amid growing national concern that the checkbox about a person’s criminal history prohibits offenders who have paid their debt to society from obtaining employment and also deters offenders from seeking jobs which causes employers to miss out on qualified applicants.


Civil service applicants will, however, be asked to disclose past crimes during job interviews and finalists for state jobs will undergo background checks.   The new practice allows people to explain the circumstances surrounding their offenses.


Ohio Administrative Services Director Robert Blair said, “Ohio came to the conclusion that checking “yes” on the box may have served as a quick way for agencies in the past to rule out applicants inside a state government that receives some 250,000 job applications a year.”

CARCO Group, Inc. Announces Partnership with Accurate Biometrics, Inc. to Provide its Clients With a Technology Enabled Fingerprint Solution

Shaking handsCARCO Group, Inc., a risk mitigation and background screening company, today announced its partnership with Accurate Biometrics, Inc., a leading provider of  live scan fingerprinting solutions to businesses and the Federal government.


Accurate Biometrics, Inc. is a technology enabled service company focusing on providing top level electronic fingerprint capture, transmission, storage, and database reporting to meet the ever changing and increasing number of applicants requiring a fingerprint-based criminal history record check. Additionally, Accurate Biometrics is one of only thirteen companies in the United States to be awarded fingerprint channeling privileges direct to the FBI.


CARCO Group, Inc. is recognized as a national leader in quality of service, timely reporting, cost-effectiveness, state-of-the-art technology solutions, and legal expertise in the pre-employment screening/risk mitigation industry.  These qualities, along with a technology enabled fingerprint solution provided through a partnership with Accurate Biometrics, will add great value in building a robust talent management solution.


“We are beyond excited about the opportunity to partner with Accurate Biometrics for fingerprinting services.  The collaboration effort to create a fingerprinting solution that will minimize the intrusion of our client’s candidates, provide extremely reliable prints, and maximize the efficiency of the process will allow us to offer a truly unique and valuable solution to many new and existing clients,” said Beth Sinkus, CARCO Group’s SVP of Business Development.