New Law for Background Screeners Who Off-Shore Data

Nick Fishman

It is indeed a rare day when I will applaud legislation that aims to restrict those who provide employment background checks. We’ve just learned that the California legislature has introducedSenate Bill 909 which would mandate that a background screener “that prepares or processes in any manner an investigative consumer report, or portion thereof, outside of the United States or its territories to make specified disclosures to the potential user of this information, including, but not limited to, the country or countries where the report, or portion thereof, will be prepared or processed. The bill would also prohibit an investigative consumer reporting agency from transmitting a consumer’s social security number, except for the last 4 digits, outside of the United States or its territories.”

I support this bill because as an industry, we have an obligation to protect both our clients and their employees, and or prospective employees.  Identity theft is rampant in our society today and we all strive to ensure that the personal information that is provided to us in order to conduct a background check is held in the strictest of confidence.

There are some in our industry that choose to off-shore this information because let’s face it, it’s cheaper than paying someone to do it stateside.  Of course, once the information leaves the direct control of the screening company, what could happen next is anyone’s guess.

This law would obligate companies that off-shore this information to disclose that fact.  According to the bill, it would also, ”prohibit an investigative consumer reporting agency from transmitting a consumer’s social security number, except for the last 4 digits, outside of the United States or its territories. The bill would require these agencies to adopt and publish a privacy policy relating to information contained in reports that are prepared or processed outside of the United States, as specified. The bill would provide that an investigative consumer reporting agency is liable to a consumer who is harmed by any act or omission that occurs outside the United States or its territories, as specified.

Lastly, it is important to note that this bill exempts these requirements for those conducting background checks on individuals that live outside of the United States.

This bill is a win/win for employers and consumers.  We know that this effort will not be popular with those in our industry engaged in this practice, but it is efforts like these that will ultimately benefit the industry at-large.  We hope that it passes and would like to see similar legislation on a federal level.

Read the California SB909

Nick Fishman
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Nick Fishman

Nick Fishman is the co-founder of EmployeeScreenIQ, a leading, global employment background screening provider, and serves as the company’s executive vice president and chief marketing officer. He pioneered the creation of EmployeeScreen University, the #1 educational resource on employment background checks for human resources, security and risk management professionals. A recognized industry expert, Nick is a frequent author, presenter and contributor to the news media. Nick is also a licensed private investigator in the states of Ohio and Texas.
Nick Fishman
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