IN THE UNITED STATES DISTRICT COURT

FOR THE DISTRICT OF COLUMBIA

__________________________________________

)

UNITED STATES OF AMERICA )

)

Plaintiff, )

) Civil Action No. 12-1313

 v. )

)

)

HIRERIGHT SOLUTIONS, INC. )

)

 Defendant. )

)

__________________________________________)

COMPLAINT FOR CIVIL PENALTIES, 

PERMANENT INJUNCTION, AND OTHER EQUITABLE RELIEF

Plaintiff, the United States of America, acting upon notification and authorization to the

Attorney General by the Federal Trade Commission (“FTC” or “Commission”), for its

Complaint, alleges:

1. Plaintiff brings this action under sections 5(a), 13(b), and 16(a) of the Federal

Trade Commission Act (“FTC Act”), 15 U.S.C. §§ 45(a), 53(b), and 56(a); and section 621(a) of

the Fair Credit Reporting Act (“FCRA”), 15 U.S.C. § 1681s(a), to obtain monetary civil

penalties, and injunctive or other relief from Defendant HireRight Solutions, Inc. for engaging in

violations of the FTC Act, 15 U.S.C. § 45(a), and the FCRA, 15 U.S.C. §§ 1681 – 1681x. 

JURISDICTION AND VENUE

2. This Court has subject matter jurisdiction over this matter under 28 U.S.C.

§§ 1331, 1337(a), 1345, and 1355, and under 15 U.S.C. §§ 45(a), 53(b), 56(a), and 1681s.

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3. Venue is proper in this district under 28 U.S.C. §§ 1391(b)-(c) and 1395(a), and

15 U.S.C. § 53(b).

PLAINTIFF

4. This action is brought by the United States of America on behalf of the Federal

Trade Commission. The Commission is an independent agency of the United States government

given statutory authority and responsibility by, inter alia, the FTC Act, as amended, 15 U.S.C.

§§ 41-58, and the FCRA, 15 U.S.C. §§ 1681-1681x. The Commission is charged, inter alia,

with enforcing section 5(a) of the FTC Act, 15 U.S.C. § 45(a), which prohibits unfair and

deceptive acts or practices in or affecting commerce; and the FCRA, which imposes duties upon

consumer reporting agencies.

DEFENDANT

5. Defendant HireRight Solutions, Inc. (“HireRight Solutions” or “Defendant”) is an

Oklahoma corporation with its principal place of business in Tulsa, Oklahoma. Defendant

transacts or has transacted business in this district.

THE FAIR CREDIT REPORTING ACT

6. The FCRA was enacted in 1970, became effective on April 25, 1971, and has

been in force since that date. The Fair and Accurate Credit Transactions Act amended the FCRA

in December 2003.

7. Section 621 of the FCRA, 15 U.S.C. § 1681s, authorizes the Commission to use

all of its functions and powers under the FTC Act to enforce compliance with the FCRA by all

persons subject thereto except to the extent that enforcement specifically is committed to some

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other governmental agency, irrespective of whether the person is engaged in commerce or meets

any other jurisdictional tests set forth by the FTC Act.

8. HireRight Solutions, formerly known as USIS Commercial Services, Inc.

is now and has been a “consumer reporting agency,” as defined in section 603(f) of the FCRA,

15 U.S.C. § 1681a(f). That section defines a consumer reporting agency as:

any person which, for monetary fees, dues, or on a cooperative nonprofit basis,

regularly engages in whole or in part in the practice of assembling or evaluating

consumer credit information or other information on consumers for the purpose of

furnishing consumer reports to third parties, and which uses any means or facility

of interstate commerce for the purpose of preparing or furnishing consumer

reports.

HireRight Solutions regularly sells in interstate commerce information on consumers that it

assembles for the purpose of furnishing consumer reports to third parties, as described further

below.

9. The FCRA imposes several obligations on consumer reporting agencies,

including obligations to take reasonable steps to ensure the maximum possible accuracy of

consumer reports, to provide consumers with access to their reports, and to implement

procedures for consumers to dispute inaccurate information in their reports. These obligations

are described in more detail below. 

DEFENDANT’S BUSINESS PRACTICES

10. HireRight Solutions provides background reports to thousands of

employers throughout the United States about prospective and current employees, in order to

assist the employers in making decisions about hiring and other employment-related issues

(“background screening reports”). These reports contain public record information, including

criminal histories of individuals, from multiple sources. 

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11. The background screening reports that HireRight Solutions provides to

employers are “consumer reports” as defined in section 603(d) of the FCRA, 15 U.S.C. §

1681a(d). That section defines a “consumer report” as: 

any written, oral, or other communication of any information by a consumer

reporting agency bearing on a consumer’s credit worthiness, credit standing,

credit capacity, character, general reputation, personal characteristics, or mode of

living which is used or expected to be used or collected in whole or in part for the

purpose of serving as a factor in establishing the consumer’s eligibility for (A)

credit or insurance to be used primarily for personal, family, or household

purposes; (B) employment purposes; or (C) any other purpose authorized under

section 604.

HireRight Solutions’ reports are communicated to third parties; bear on, among other things,

consumers’ general reputation and personal characteristics; and are used as a factor in

determining eligibility for employment.

ACCURACY

12. Section 607(b) of the FCRA, 15 U.S.C. § 1681e(b), requires all consumer

reporting agencies to follow reasonable procedures to assure maximum possible accuracy of

consumer report information.

13. In numerous instances, Defendant failed to follow reasonable procedures to

assure maximum possible accuracy. Among other things, Defendant:

 (1) failed to follow reasonable procedures to assure that the information

contained in consumer reports it furnished reflected the current public

record status of consumers’ information, such as expungement of a

criminal record; 

(2) failed to follow reasonable procedures to prevent the inclusion of multiple

entries for the same criminal offense in the same report; and

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(3) failed to follow reasonable procedures to prevent the provision of 

obviously erroneous consumer report information to employers, such as

purported information on a single consumer that included records of other

consumers with different names, dates of birth, or other identifiers that are

available in the public record. 

14. In multiple instances, these failures led to the reporting of inaccurate consumer

report information regarding prospective employees who were then denied employment or other

employment-related benefits.

ACCESS AND CORRECTION

15. Under the FCRA, consumer reporting agencies must allow consumers to access

their own information and dispute any inaccurate information. In relevant part, the process is as

follows: First, consumer reporting agencies must, upon request, clearly and accurately disclose

to a consumer who requests his or her file all information in that file at the time of the request. 

15 U.S.C. § 1681g(a). Second, within thirty days of receiving a notice that a consumer disputes

the completeness or accuracy of information in his or her file, the consumer reporting agency

must conduct a reasonable reinvestigation to determine whether the disputed information is

inaccurate and record the current status of the disputed information, or delete the information

from the file. 15 U.S.C. § 1681i(a)(1)(A). Third, the consumer reporting agency must provide

written notice to the consumer of the results of the reinvestigation not later than five business

days after its completion. 15 U.S.C. § 1681i(a)(6). Defendant did not comply with one or more

of these requirements. 

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16. In numerous instances, Defendant either failed to provide consumers with

information in their files or failed to do so upon request. Their systems for fulfilling requests for

reports resulted in either delays or the non-fulfillment of the requests. For example, HireRight

Solutions, Inc. experienced numerous backlogs for fulfilling consumers’ requests because of

inadequate staffing or technical problems.

17. In numerous instances, Defendant did not conduct reinvestigations of disputed

items in a consumer’s file upon receipt of a notice of dispute from the consumer. Defendant

required consumers who wished to dispute information in consumer reports to have a copy of the

report before Defendant would initiate a reinvestigation. For consumers who did not have their

consumer report, Defendant routinely instructed them to request a copy before Defendant would

initiate a reinvestigation. This practice often delayed the reinvestigation process and made it

more difficult for consumers to initiate that process.

 18. In numerous instances, Defendant closed dispute reinvestigations without

providing written notice of the results of the reinvestigations to affected consumers. 

SPECIAL OBLIGATIONS ON BACKGROUND SCREENERS

WHO USE PUBLIC RECORD INFORMATION

19. The FCRA contains special requirements for consumer reporting agencies that

furnish consumer reports containing public record information for employment purposes, if that

information is likely to have an adverse effect upon a consumer’s ability to obtain employment.

These consumer reporting agencies must either (1) notify the consumer, at the time that such

information is reported, of the fact that public record information is being reported, or (2)

maintain “strict procedures” designed to ensure the reported public record information is

complete and up to date. 15 U.S.C. § 1681k(a).

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20. In numerous instances, Defendant neither (1) notified consumers, at the time the

information was reported, that they reported public record information to employers, nor (2)

maintained “strict procedures” to ensure that the information in the reports was complete and up

to date. They had a complex, multi-step process for notifying consumers that public record

information was being reported. This process was not initiated until the day that the report was

electronically transmitted to the employer and typically took more than one day to complete. As

a result, the notices were not mailed to consumers at the time the information was reported to

employers. Moreover, as described in Paragraph 13, Defendant did not maintain “strict

procedures” to ensure that reported public record information was complete and up to date.

 VIOLATIONS OF THE FAIR CREDIT REPORTING ACT

COUNT I

21. As described in Paragraph 13, in multiple instances, Defendant failed to use

reasonable procedures to assure maximum possible accuracy of consumer report information.

22. By and through the acts and practices described in Paragraph 13, Defendant has

violated section 607(b) of the FCRA, 15 U.S.C. § 1681e(b). 

23. Pursuant to section 621(a)(1) of the FCRA, 15 U.S.C. § 1681s(a)(1), the acts and

practices alleged in Paragraph 22 also constitute unfair or deceptive acts or practices in violation

of section 5(a) of the FTC Act, 15 U.S.C. § 45(a). 

COUNT II

24. As described in Paragraph 16, in multiple instances, Defendant failed to disclose

to consumers, upon request, all information maintained in their consumer report files.

25. By and through the acts and practices described in Paragraph 16, Defendant has

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violated section 609(a)(1) of the FCRA, 15 U.S.C. § 1681g(a)(1).

26. Pursuant to section 621(a)(1) of the FCRA, 15 U.S.C. § 1681s(a)(1), the acts and

practices alleged in Paragraph 25 also constitute unfair or deceptive acts or practices in violation

of section 5(a) of the FTC Act, 15 U.S.C. § 45(a). 

COUNT III

27. As described in Paragraph 17, in multiple instances, Defendant failed to conduct

reinvestigations of the completeness or accuracy of information contained within a consumer’s

file upon receipt of a notice of dispute from the consumer.

28. By and through the acts and practices described in Paragraph 17, Defendant has

violated section 611(a)(1)(A) of the FCRA, 15 U.S.C. § 1681i(a)(1)(A).

29. Pursuant to section 621(a)(1) of the FCRA, 15 U.S.C. § 1681s(a)(1), the acts and

practices alleged in Paragraph 28 also constitute unfair or deceptive acts or practices in violation

of section 5(a) of the FTC Act, 15 U.S.C. § 45(a). 

COUNT IV

30. As described in Paragraph 18, in multiple instances, Defendant closed dispute

reinvestigations without providing written notice of the results of the reinvestigations to affected

consumers.

31. By and through the acts and practices described in Paragraph 18, Defendant has

violated section 611(a)(6) of the FCRA, 15 U.S.C. § 1681i(a)(6).

32. Pursuant to section 621(a)(1) of the FCRA, 15 U.S.C. § 1681s(a)(1), the acts and

practices alleged in Paragraph 31 also constitute unfair or deceptive acts or practices in violation

of section 5(a) of the FTC Act, 15 U.S.C. § 45(a). 

COUNT V

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33. As described in Paragraph 20, in multiple instances, Defendant failed to provide

written notice to consumers of the fact that it reported public record information to employers, at

the time the information was reported. Defendant also failed to maintain strict procedures to

ensure that the public record information in the reports was complete and up to date.

34. By and through the acts and practices described in Paragraph 20, Defendant has

violated section 613(a)(1)-(2) of the FCRA, 15 U.S.C. § 1681k(a)(1)-(2). 

35. Pursuant to section 621(a)(1) of the FCRA, 15 U.S.C. § 1681s(a)(1), the acts and

practices alleged in Paragraph 34 also constitute unfair or deceptive acts or practices in violation

of section 5(a) of the FTC Act, 15 U.S.C. § 45(a).

THIS COURT’S POWER TO GRANT RELIEF

36. Section 621(a)(2)(A) of the FCRA, 15 U.S.C. § 1681s(a)(2)(A), authorizes the

Court to award monetary civil penalties in the event of a knowing violation of the FCRA, which

constitutes a pattern or practice. Defendant’s violations of the FCRA, as alleged in this

Complaint, have been knowing and have constituted a pattern or practice of violations. As

specified by the Federal Civil Penalty Inflation Adjustment Act of 1990, 28 U.S.C. § 2861, as

amended by the Debt Collection Improvements Act of 1996, Pub. L. 104-134, § 31001(s)(1), 110

Stat. 1321-373, the Court is authorized to award a penalty of not more than $2,500 per violation

for violations occurring before February 10, 2009, and $3,500 per violation for violations

occurring on or after that date. 

37. Each instance in which Defendant has failed to comply with the FCRA constitutes

a separate violation of the FCRA for the purpose of assessing monetary civil penalties under

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section 621 of the FCRA, 15 U.S.C. § 1681s. Plaintiff seeks monetary civil penalties for every

separate violation of the FCRA.

38. Under section 621(a) of the FCRA, 15 U.S.C. § 1681(a), and section 13(b) of the

FTC Act, 15 U.S.C. § 53(b), this Court is authorized to issue a permanent injunction prohibiting

Defendant from violating the FTC Act and the FCRA. 

PRAYER FOR RELIEF

WHEREFORE, Plaintiff requests that this Court, pursuant to 15 U.S.C. §§ 45(a), 53(b),

1681s, and 1691c, and pursuant to the Court’s own equitable powers:

(1) Enter judgment against Defendant and in favor of Plaintiff for each law violation

alleged in this Complaint;

(2) Enter an injunction against Defendant to prevent further violations of the FCRA

and the FTC Act, as alleged herein;

(3) Award Plaintiff monetary civil penalties from Defendant for each violation of the

FCRA as alleged in this Complaint; 

(4) Order Defendant to pay the costs of this action; and

(5) Award Plaintiff such additional relief as the Court may deem just and proper.

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DATED: August 8, 2012

FOR THE UNITED STATES 

OF AMERICA:

STUART F. DELERY

Acting Assistant Attorney General

Civil Division

United States Department of Justice

MAAME EWUSI-MENSAH FRIMPONG

Deputy Assistant Attorney General

Civil Division

MICHAEL S. BLUME

Director

Consumer Protection Branch

 s/ Alan J. Phelps 

ALAN J. PHELPS

Trial Attorney

Consumer Protection Branch

U.S. Department of Justice

PO Box 386

Washington, D.C. 20044

Phone: 202-307-6154

Facsimile: 202-514-8742

E-mail: alan.phelps@usdoj.gov

DC Bar No.: 475938

FOR THE FEDERAL TRADE

COMMISSION:

MANEESHA MITHAL

Associate Director

Division of Privacy and Identity Protection

ROBERT SCHOSHINSKI

Assistant Director

Division of Privacy and Identity Protection

ANTHONY RODRIGUEZ

Attorney

Division of Privacy and Identity Protection

Federal Trade Commission

601 New Jersey Ave. NW

Mail Stop NJ-8100

Washington, D.C.

Phone: 202-326-2757

Facsimile: 202-326-3062

TIFFANY GEORGE

Attorney

Division of Privacy and Identity Protection

Federal Trade Commission

601 New Jersey Ave. NW

Mail Stop NJ-8100

Washington, D.C.

Phone: 202-326-3040

Facsimile: 202-326-3062

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