FTC Announces $2.25M Settlement with Tenant Screening Company

On July 9, 2026, the Federal Trade Commission (FTC) announced a $2.25 million settlement with a tenant screening company after filing a complaint alleging several violations of the Fair Credit Reporting Act (FCRA).

According to the complaint, the tenant screening company failed to: (i) follow reasonable procedures to assure maximum possible accuracy, (ii) disclose all information contained in the consumer’s file and the sources of such information upon consumer request, and (iii) follow reinvestigation requirements applicable to resellers of consumer reports. The FTC further alleged that the tenant screening company falsely misrepresented to consumers who successfully disputed information that it had reported updates to the property managers.

Let’s break down each of these allegations.

Allegation 1: Accuracy

Section 607(b) of the FCRA requires a consumer reporting agency (CRA) to “follow reasonable procedures to assure maximum possible accuracy of the information” when preparing a consumer report.

While that may seem straightforward, this provision of the FCRA is often the source of litigation. One of the more common claims under this section occurs when a CRA incorrectly reports a criminal record as belonging to a consumer (i.e., the record belongs to someone else). However, this is not the only action that can land a CRA in hot water. Lawsuits have also focused on duplicate reporting issues and whether the record as included on the consumer report accurately reflects the most up-to-date version of that record. For example, a CRA may accurately report that a criminal record belongs to a consumer, but neglect to include that the consumer received a pardon for that record. As another example, a CRA may report a criminal record as a conviction even though it had been later dismissed.

Turning back to the complaint, the FTC focused on the duplicate reporting issue. Specifically, the FTC claimed the tenant screener failed to follow reasonable procedures to prevent the inclusion of duplicative case records and multiple entries for the same criminal or eviction action in the consumer reports it prepared. In particular, the tenant screener would list the same conviction or eviction record multiple times so they appeared to be separate records – making it look like a consumer had more criminal and/or eviction records than they actually did.

Interestingly, the complaint claimed the tenant screener often received these records from other CRAs with clear headers and different events in a particular record grouped together, but rather than reporting the information as received, it reformatted the results leading to the duplicate reporting issue.

Allegation 2: File Disclosure Failures

Section 609 of the FCRA requires CRAs to provide all information in the consumer’s file to the consumer upon request. As part of this disclosure, CRAs must identify the sources of information (except sources used in preparing an investigative consumer report) and identification of each person who obtained a consumer report from the CRA in the prior two years (for employment purposes) or one year (for all other purposes). Just what constitutes “all information in the consumer’s file”? That remains largely undefined and open to interpretation by CRAs navigating this legal requirement.  

In the complaint, the FTC focused on what the tenant screener did not include in file disclosures – namely, information obtained from its name and address history information provider (generally the information that is used in SSN trace products). This information includes p a list of past addresses, additional names and other data with respect to each consumer submitted by the tenant screener to the information provider. As outlined in the complaint, the tenant screener used this information to help match public records to consumers, provided this information to other CRAs to search for and report public records, and used the information in subsequent consumer disputes.

The FTC alleged the tenant screener violated Section 609 by failing to disclose to consumers it used this name and address history and by failing to disclose the vendor as a source of information in its file disclosures.  

Allegation 3: Reinvestigation Issues

Section 611 of the FCRA includes the procedures a CRA must follow if the consumer claims something on the report is inaccurate or incomplete. This is known as the reinvestigation process.

For resellers – those entities that assemble and merge information from databases of other CRAs to create consumer reports, but do not actually store the information or use it to generate new consumer reports – there are limited reinvestigation requirements. Requirements for resellers are found in Section 611(f).

As outlined in Section 611(f), if the completeness or accuracy of information is disputed by the consumer, the reseller must determine (within five days) whether the disputed information is incomplete or inaccurate due to action they took. If the information is incomplete or inaccurate due to their actions, they must correct or delete the information within twenty days. If it’s not a result of their actions, the reseller must forward the dispute to any CRA that was involved in providing the disputed information.

Rather than following this process, the FTC claimed that the tenant screener had a process to mark certain consumer disputes as “invalid”. For these disputes, which included disputes over duplicate record reporting and disputes concerning changes to records after the consumer report was produced, the tenant screener did not follow its reseller reinvestigation obligations.

Allegation 4: Notification Failures

The FTC next turned to allegations that the tenant screener did not accurately notify the landlord or property manager when a report had been updated in scenarios where the change to the consumer report did not result in a change to the consumer’s screening result (i.e., accept or decline). Instead, the tenant screener would notify the prospective landlord or property manager that the “investigation is complete and there were no changes to the applicant’s screening result.” However, the tenant screener would send correspondence to the consumer claiming they did notify the property where the consumer applied that the consumer report had been updated.

Closing Thoughts

Duplicate reporting is worth a CRA’s attention. Prior to the change in administration, the CFPB issued an advisory opinion that, in part, claimed a CRA is not using reasonable procedures to assure maximum possible accuracy if it did not have procedures in place to prevent reporting information that is duplicative.

CRAs should also review its file disclosure procedures. Which sources are you identifying and how are you communicating that to consumers? The CFPB had issued an advisory opinion on this topic as well taking a broad look at what type of communication from a consumer constitutes a request for a file disclosure and what information should be in the file disclosure produced by the CRA.

It’s important to note that both of the aforementioned CFPB advisory opinions were withdrawn effective May 12, 2025. However, the litigation and/or enforcement risk with respect to these issues remains as evidenced in this FTC action. CRAs should consult with qualified legal counsel to review procedures for addressing duplicate reporting, file disclosures and disputes/reinvestigations.

The preceding is offered as educational information and does not constitute legal advice.