Federal Trade Commission (FTC) and Consumer Financial Protection Bureau (CFPB) Seek Public Comment on Tenant Background Screening

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Federal Trade Commission (FTC) and Consumer Financial Protection Bureau (CFPB) Seek Public Comment on Tenant Background Screening

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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    Thomas Ahearn - Digital Content Editor

    Thomas Ahearn is a Digital Content Editor at ClearStar, a leading Human Resources technology company specializing in background checks, drug testing, and occupational health screening. He writes about a variety of topics in the background screening industry including Artificial Intelligence (AI), "Ban the Box," class action lawsuits, credit reports, criminal records, drug testing, Equal Employment Opportunity Commission (EEOC), Fair Credit Reporting Act (FCRA), identity theft, privacy, social media screening, and workplace violence.

    At ClearStar, we are committed to your success. An important part of your employment screening program involves compliance with various laws and regulations, which is why we are providing information regarding screening requirements in certain countries, region, etc. While we are happy to provide you with this information, it is your responsibility to comply with applicable laws and to understand how such information pertains to your employment screening program. The foregoing information is not offered as legal advice but is instead offered for informational purposes. ClearStar is not a law firm and does not offer legal advice and this communication does not form an attorney client relationship. The foregoing information is therefore not intended as a substitute for the legal advice of a lawyer knowledgeable of the user’s individual circumstances or to provide legal advice. ClearStar makes no assurances regarding the accuracy, completeness, or utility of the information contained in this publication. Legislative, regulatory and case law developments regularly impact on general research and this area is evolving rapidly. ClearStar expressly disclaim any warranties or responsibility or damages associated with or arising out of the information provided herein.

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