Consumer Financial Protection Bureau Issues Advisory About Name-Only Background Screening

What’s in a name? There is a great deal of frustration, confusion, and even difficulty navigating normal life if you are among the 38,000 Americans named James Smith or one of the 32,000 Maria Garcias in the United States.

If you have a common first- and surname combination, it’s likely that you’ve been misidentified as someone else at least once in your life. Maybe you’ve even missed out on opportunities, like employment or an apartment rental, thanks to a case of mistaken identity. Now, the Consumer Financial Protection Bureau (CFPB) is taking measures to lessen the frequency of these mixups.

No More Name-Only Screenings

The CFPB recently issued an advisory opinion regarding consumer reporting agencies that provide screening of potential tenants or employees. Previously, these agencies could use “name-only matching” when running background checks on individuals. As a result, many people wound up being rejected for jobs and housing based on erroneous information—some other Jennifer Johnson’s criminal record or a different Michael Williams having been evicted for non-payment of rent.

According to the Federal Register, this happens “when a consumer reporting agency uses only first and last name to determine whether a particular item of information relates to a particular consumer” without also taking into account the individual’s date of birth, Social Security number, or other pieces of identifying information.

Matching Info To Avoid Mistaken Identity

Now, consumer reporting agencies that don’t go that extra mile to distinguish one Ann Nguyen from another are in violation of the Fair Credit Reporting Act—and therefore breaking the law.

While it’s possible to correct such errors, of course, it may not be quick or easy to do so. This means that by the time an applicant for housing rental or employment straightens everything out, the opportunity for which they were being screened in the first place is usually long gone.

Those Most Vulnerable to Mixups

These cases of mistaken identity are much more likely to occur among Hispanic, Black, and Asian populations. That’s because these demographics have fewer surnames and therefore much less diversity when it comes to last names. In fact, 26 surnames account for fully one-quarter of the total U.S. Hispanic population. (In comparison, a quarter of those identified as non-Hispanic white individuals comprise over 300 surnames.)

New Protections, But Plenty of Problems Remain

Thanks to the advisory opinion issued by the CFPB, consumers now enjoy a level of protection from name-only reporting that leads to tenant/housing background check errors and inaccurate employment and criminal background checks. However, there are still plenty of issues—identity theft, data breaches, mixed-file credit reports, and credit reports that are erroneous for no clear-cut or systematic reason—that still plague American consumers. Getting a credit report error cleared up is no easy matter, and if you go it alone, you’ll face an uphill climb with no guarantee of a resolution.

Instead, turn to the Law Office of Adam G. Singer, a trusted credit defense attorney. No matter what credit reporting error issue you’re grappling with, the services of an experienced and compassionate lawyer can help you straighten out your credit report—and ensure that your financial future is secure. Call us at 212-842-2428 or contact us online for a complimentary consultation.