NAPBS 2014 Legislative and Regulatory Conference

2014 NAPBS Legislative and Regulatory Conference

Arlington, VA, April 6-9, 2014

This report is no longer the “Mid-year” or the “Fly-in” report; it is now renamed as above. Why? Because it has been reorganized to be just that. At this conference there were no breakout sessions, no FCRA 101 training or similar education sessions. Everyone was in the same presentations at the same time. At first, this felt a bit strange, but based on input from others and an explanation of the main purpose of the conference, I think the board was right-on to structure the conference in this manner. Here is how Mike Pachuta put it: “The general session format was very beneficial as we brought multiple staff members and it was great to be able to hear the same information and then discuss that information among ourselves in detail. I would highly recommend that members bring their senior staff as our PROFESSION depends on members understanding the guidance, the laws and the regulations.” Of course, we will see at the fall conference the return of all the education sessions that are critical to all levels in the CRA.

We did experience some fantastic speakers on subjects all near and dear to our hearts. How is this for a line-up:

Jacqueline Berrien, the Chair of the EEOC. We actually got the head person at the EEOC (remember, this is the agency that seems to want to put limits on the use of criminal information in the hiring decision!). What Chair Berrien said and what she did not say was very telling. You had to be there. She brought up that EEOC was celebrating 50 years since Title 7 and that day was her 4th year anniversary as the head of EEOC. Then, after spending many minutes thanking everyone in her organization and everyone at NAPBS and the NAPBS legal counsel, she gave a very articulate and cogent recap of how the EEOC got to deciding on the guidance they issued in 2012. She said this guidance was “really nothing new” since it had been published as early as 1990, reflected past court decisions and prior federal law. Note: she did acknowledge that NAPBS was influential in shaping the guidance. About 45 minutes into her presentation, much of the crowd moved on to listening with one ear while working their emails and texts. No one was impolite; it was just a bit too much “governmentspeak” for many of us. She was very gracious, articulate and knowledgeable and was properly prepped by her staff (of which at least two were in attendance). Here is what I got:

• The guidance was not designed to give favorable preference to the convicted, but something needs to be done to facilitate the re-entry into the workforce of people with criminal records.

• She agrees it is prudent to do the criminal background checks and cited examples of how to apply the results to the decision to use that adverse information in the hiring decision.

• The EEOC is not trying to stop criminal background checks but the convicted need a chance for re-entry into the workforce.

• The EEOC will look to NAPBS in the future for our guidance should they choose to modify their guidance or need input on subjects related to our industry.

• Ban the box is not a federal requirement but this would be their preferred practice.

• They are definitely trying to enforce the guidelines, even going so far to sue employers. Two suits have been filed, both are pending. Also, Pepsi and JB Hunt have agreed to change their practices as a consent to make EEOC threats go away.

Regardless of her input or how you feel about the EEOC, there is no question getting her to speak at our conference was a big kudos to NAPBS! She most assuredly knows we exist and that 250 people were there to listen to what she had to say.

Montserrat Miller – NAPBS’s lobbying attorney spoke about the FTC and recent developments related to the Screening Industry. I only caught the tail end of this but the information was coming at me so fast I felt like I was drinking water from a fire hose, as Montserrat peppered us with case after case after case. I couldn’t keep up with the note taking. Suffice to say, be in compliance. Know what is required and make sure you do it consistently; else you might create the opportunity for a lawsuit.

Georgia Attorney General, Sam Owens. I’m sorry to say I missed this completely but everyone said he was the best. He was humorous, sincere, 180 degrees from the opinions of Chair Berrien and the EEOC. I heard he received a standing ovation.

General Session, Disparate Impact Challenges to the use of Screening.  Sorry, missed this one too. Had to be in our exhibit booth. We were very busy.

General Session, Pam Devata. This session focused on hot topics in background screening compliance and specific tips to mitigate your litigation exposure as a CRA. She spoke about new theories of litigation being tested in the courts, regulatory focus, and best practices. Sorry my notes are not as clear as they should be but I believe the following came from Pam. (Disclaimer: I may have missed something in my notes and I am not an attorney and do not give legal advice so check with your counsel if you have a question).

Big issue is all the laws being passed that require a background check and this is defined as a fingerprint check via the FBI. We all know and it has been stated clearly by the justice department that the FBI files are not comprehensive, frequently do not contain dispositions, cannot be current on expungements and, if not done via a CRA, have no provision to protect the consumer if there is adverse information on the FBI report.

There are 128 current bills that related to background checks.

As regards reporting of non-convictions, is the date measured from date of arrest or date of last activity?

The net of this is, as of this moment, for dismissed or non-adjudicated cases, measure the 7-year reporting period from the date of the adverse event (i.e. arrest). If the case resulted in a diverted or adjudication withheld, then make a good faith effort to find out what happened after that. If no further court action, use the date of arrest, if further action, may be OK to report from a later date. The key seems to be to measure from the last “adverse event”.

The courts have ruled that if a CRA gives a red light/green light evaluation, then anytime it is not a green light, an adverse notice is required. Oops, wait. A California ruling overrode this. Not totally settled yet. Suggestion was to get rid of the red light/green light. New York has laws specific to this.

Make sure your certification from your client that they will get a release and comply with the FCRA’s other requirements (Permissible Purpose, Adverse Action, etc.) is also in compliance with California’s more restrictive language. And get your clients to re-certify every few years because things and people change at your client.

There is no time limit on a consumer dispute. Consumers are entitled to a free file disclosure. Be very tuned in to what is defined as a ‘file’. Any request for by a consumer for their “file” has a significant probability that it is just phishing (just looking for something you did incorrectly so they can file suit).

Asim Fareeduddin addressed the issue of data security. I tend to not worry about such things but after listening to him, I took a lot of notes. Key points include:

• Put your security framework in writing including what you should do as soon as you find a breach.

• Implement audits to check on internal or external activity. Are you being hacked?

• Be sure to credential employees, contractors, anyone with access (Duh!).

• ISO 27002 or COBIT are two standards.

It is interesting that the next day when we were “on the hill” our group met with the FTC who took 10 minutes to hear about NAPBS but then turned the meeting to data security because they are trying to develop a minimum national standard that would apply to all and to replace the different laws that address this issue in the 47 states that have laws. Fortunately Gregory Kirsch (Applicant Insight), Co-chair of the NAPBS Best Practices Committee, and the founding Co-chair of the Data Breach Prevention Sub-committee, was in our group and he was able to respond intelligently and impress the FTC with NAPBS’s attention to this issue. Thanks Greg.

GARP Committee: The final session was in regard to a survey of criminal record reporting practices. The committee reported on the results of a survey they did of members to come up with Generally Acceptable Reporting Practices (GARP). 88% of CRAs said they will report criminal records if there are two or more identifiers on the record. More results to follow from committee.

The total count of attendees at this conference was 285 (100 exhibitor and 185 attendees). This is down from last year’s 364, which was a record. Members attended from 34 states and Saipan.

The conference kicked off on Sunday night with an abbreviated opening ceremony followed by the exhibit floor open to all. Highlights of the opening comments:

• NAPBS had 60 meetings with legislature in recent months

• NAPBS has a new website

• European Chapter is flourishing

Forty-five exhibitors again supported NAPBS this year, the same sold-out number as the last mid-year. Lots of exhibitor prizes too. We gave away $500 in our Vault Verify vendor demo presentation.

On the Hill

Wednesday was an early day, with a briefing at 7am and a bus pickup at 7:30. A short drive into DC where we separated into groups to meet with our respective elected officials (or their staff). My group of ten first met with someone from the Judiciary Committee and we did our education and got our point across. We then went on to meet for a half hour with three FTC staffers and again we got our point across. Next, another half hour with a policy analyst with the Committee on Energy and Commerce (Henry Waxman committee); they do the oversight on the FTC. Finally, we got to meet with a staffer at our congressional representative’s office to explain our point and we actually got to meet with our rep (Patrick Murphy-Dem, FL) but only because I had met him before and he remembered me (or at least pretended to remember me). We were lucky enough to catch him between two meetings he was having.

About 60 people stayed over on Wed to contribute their valuable time to go up “on the hill” to talk to their representatives and those that run the EEOC, CFPB, FTC, etc. The message we carried was threefold.

1. We have a 10 year old professional background screening association established to create best practices, accreditation, education of our members, and consistency, about which all these agencies need to be educated.

2. Since the people are constantly changing in these government agencies and at the legislature, we need to be constantly lobbying them regarding our positions and to educate them to use NAPBS as a resource.

3. Much legislation is being passed that requires a criminal background check and the default is to a fingerprint check. We educated them that a commercial criminal background check can be better because it will be:

     a. More comprehensive 

          i. Includes all the criminal cases in that court, not just those that happened to make it to the FBI files. 

          ii. The FBI files often do not get dispositions, the court record everything about that arrest. Under the FCRA, the arrest information should not even be reported if not a conviction over 7 years old, but the FBI files are not subject to any quality control.

          iii. Is more current, with the very latest court information (especially those expungements that our government feels are so necessary so the convicted can have an easier road to re-entry into the workforce). 

     b. More protecting of the consumer since doing a check through a CRA the consumer has FCRA protections regarding notification of adverse information with error resolution rights and methodologies that do not exist with a fingerprint check.

These 60 NAPBS members invested several hours to communicate to our regulators and representatives what we were all about. You truly need to appreciate how many hours are spent and the efforts expended by your NAPBS volunteers.

Fun Times

Monday night saw Innovative Enterprises again with an open bar bash (the No-Sales Zone). Lots of fun, dancing, talking and camaraderie. Thanks to Innovative for this and to all the exhibitors who sponsored all the functions.

Tuesday night was a nice closing dinner. They had a three piece group that played quiet soft jazz which was great for dinner but some wanted to dance. So we got these three elder musicians to pick up the pace and soon they were playing rock stuff, doing it very well and were having a much better time. The acoustics in the room left much to be desired but we all had a very nice meal and some networking and some fun.

According to ID Validation/CBSV, Evan Zatt is the undisputed mini-basketball champion!

Health of the Industry

Business is up very nicely for most during Q1 and especially in Feb and March. While the unemployment rate is no longer falling, there is still turnover and we are needed. CRAs are continually looking for new products/services to add to their product line.

Bruce’s Comments:

Dean Carras and Adam Townsend did a fantastic job again as chair of the Conference Committee in pulling off a super meeting. Big Thanks to them and the entire committee for a “hitch less” conference.

If you did not attend, once again you missed out. Your company will not be as strong, your people not as knowledgeable, your clients not as well served and you did not learn the factors that could significantly increase your legal exposure. It’s your industry. Join NAPBS! And support NAPBS. Become active in a committee and come to the conferences.

The Fall Conference will be in Denver. October 19-21. Put it in your budget and on your calendar.

Linda Gandee on April 25, 2014 at 12:31 pm said:

Yet again another great summary of NAPBS….I so look forward to your report and I thank you so much!!

Blane Sherron on April 25, 2014 at 12:27 am said:

Bruce…thank you for taking the time to update us on this conference. Sounds like I missed a good one.

Chuck Salvia on April 24, 2014 at 10:51 pm said:


As always, thank you for a terrific summary of NAPBS events/information from the 2014 mid-year conference.

Evan Zatt will have to bring the mini-basketball set when we all reconvene at NAPBS Denver in October!

Warm regards,