The Federal Trade Commission (FTC) and Consumer Financial Protection Bureau (CFPB) have both issued a “Request for Information” seeking public comment on tenant background screening issues that affect individuals who seek rental housing including how the use of criminal records and algorithms affect tenant screening decisions, according to an FTC press release.
The FTC and CFPB are asking current tenants, prospective tenants, advocacy groups, commercial and individual landlords, property managers, background screening companies, consumer reporting agencies, and others to weigh in on issues that affect tenant background screening as part of the “Request for Information.” These issues include the following:
- How criminal and eviction records are used by landlords and property managers in making housing decisions;
- How potential inaccuracies in criminal and other records affect rental housing decisions;
- Whether consumers are informed about the criteria used in tenant screening or notified about what information in their background check led to their rejection;
- How landlords and property managers are setting application and screening fees;
- How algorithms, automated decision-making, artificial intelligence, or similar technology are used in the tenant screening process; and
- Whether there are ways to improve the current tenant screening process.
The FTC and CFPB are working to identify practices that may unfairly prevent consumers from obtaining and retaining housing, and comments will help inform enforcement and policy actions. The Fair Credit Reporting Act (FCRA) – a federal law that regulates background checks which the FTC and CFPB both enforce – also imposes requirements on tenant screening.
Since renters are facing a range of challenges in finding rental housing, the FTC and CFPB are seeking information on tenant background screening practices and their potential effect on the ability to obtain rental housing as part of a White House effort to address these issues. Comments may be submitted at Regulations.gov and must be received no later than May 30, 2023.
ClearStar is a leading global Human Resources technology company that specializes in background checks, drug testing, and occupational health screening. ClearStar offers FCRA-compliant tenant background screening services that help protect rental properties and renters. For more information about tenant background screening services, please contact ClearStar.
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