Synergy One Lending Consumer Report Authorization FCRA Class Action

Companies may request consumer reports on employees or prospective employees, but only according to the Fair Credit Reporting Act (FCRA), which has requirements for authorization and use of such reports. The complaint for this class action alleges that Synergy One Lending, Inc. violated the FCRA and California state laws in the document it used to get authorization for background checks. 

Plaintiff Michelle Raub applied for a job with Synergy in December 2015 in San Diego County, California. As part of the process, Synergy gave her a document entitled “Authorization for Background Checks” in preparation for doing a background check on her. 

At the time, she did not know there was anything wrong with the document, but she discovered it in her personnel file during the past two years. 

The FCRA requires that parties who intend to obtain a consumer report on a person provide a “clear and conspicuous” disclosure of that fact, in writing, in a document that consists “solely of the disclosure” and that the person authorize the background check in writing. However, the document given to Raub contained quite a bit of other information. This is one violation of the law.

The document also required agreement with other propositions, not all of which were legally permitted. 

For example, the document refers generally to “background reports,” but this term includes both consumer reports and investigative consumer reports. The FCRA requires a separate disclosure for each. Also, the disclosure for an investigative consumer reports should disclose “that an investigative consumer report including information as to his character, general reputation, personal characteristics, and mode of living … may be made…”

For another example, the document says, as a proposition the signer must agree to, “I understand that the company may rely on this authorization to order additional background reports, including investigative consumer reports, during my employment without asking me for my authorization again as allowed by law.”

This is what is known as an “evergreen consent,” which the complaint claims is illegal. Under California law, the complaint says, if a company wants to obtain additional reports at a later date, it must make a disclosure to, and get written authorization from, the person each time. 

Three classes have been defined for this action. 

• The FCRA Class is all persons in the US who applied for a position with Synergy and filled out the Authorization for Background Checks form between August 16, 2014 and final judgement in this case 
• The ICRAA Class is all members of the FCRA Class who live in California.
• The CCRAA Class is all persons who live in California who applied for aa position with synergy and filled out the Authorization for Background Checks form between August 16, 2012 and the date of trial in this case.

Article Type: Lawsuit
Topic: Employment
Tags: Background Reports, FCRA, Failure to provide proper notice and/or obtain proper authorization