Some credit reporting agencies and investigation companies compile what is known as "investigative consumer reports." Such reports are covered under the FCRA and laws in many states. An investigative consumer report can only be used in limited circumstances including employment background checks, insurance, and rental housing decisions. An investigative consumer report does not contain information about your credit record that is obtained directly from a creditor or from you. For example, an investigative consumer report should not contain information about a late payment. This type of report cannot be used to grant credit.

Investigative reports can contain information on your character, reputation, personal characteristics and life style. This information may be gathered through personal interviews with neighbors, friends, associates or acquaintances, as well as a search of public documents such as property and court records.

Because the information in these reports is so detailed and may be sensitive, both federal (FCRA) and state laws impose stricter regulations on CRAs and other investigators that compile investigative reports (federal FCRA, 15 USC 1681d sections 604, 606, and 615; California Civil Code 1786 et seq.). Federal law requires the requester of an investigative consumer report for employment purposes to obtain permission to conduct the report. An exception would be, for example, if an employee were being investigated for possible criminal activity. If the information obtained in the report is used by the employer to make a negative hiring decision, the employer must give the applicant a copy of the report. You have the same rights to correct and dispute inaccurate information in an investigative report as you have in a credit report.

If you want more information on investigative consumer reports used for employment purposes, see www.ftc.gov/bcp/conline/pubs/buspubs/credempl.htm. See also PRC Fact Sheet 16, "Employment Background Checks: A Jobseeker�s Guide," www.privacyrights.org/FS/fs16bck.htm.

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