Advisory Opinion to Copple (06-10-98)

June 10, 1998

Ms. Susan Boesen Copple
Iowa Association of Homes & Services for the Aging
100 East Grand -- Suite 140
Des Moines, Iowa 50309

Re: State law enforcement agencies - FCRA § 603(f)

Dear Ms. Copple:

This responds to your letter concerning the application of the Fair Credit Reporting Act (FCRA) to criminal history and other information that health care facilities are required by state law to obtain through the Iowa Department of Criminal Investigation (DCI).(1) Your letter states that DCI is paid a fee for each such report. You ask if DCI constitutes a "consumer reporting agency" (CRA) under the FCRA.

In our view, a state agency such as DCI that provides information such as criminal records checks to further law enforcement or other policies mandated by the state legislature should not be considered a CRA. It is well settled that the Federal Bureau of Investigation (FBI), which also makes such reports to employers, is not a CRA. Ricci v. Key Bancshares of Maine, Inc., 768 F.2d 456, 466 (1st Cir. 1985); Ollestad v. Kelley, 573 F. 2d 1109, 1111 (9th Cir. 1978). Although it is possible to interpret the very broad terminology in the definition of "consumer reporting agency" set forth in Section 603(f) to include a law enforcement agency such as DCI or the FBI,(2)because they are paid a fee by employers when they respond to criminal records inquiries, we agree with the court in Ollestad that Congress intended no such result.(3) We see no reason why a state law enforcement agency such as DCI should be treated differently from the FBI.

In sum, it seems quite clear that DCI's communication of criminal record and similar information to health care employers is part and parcel of its law enforcement functions, undertaken to further the decision by the Iowa legislature to promote the public benefit by monitoring individuals employed in that industry. We do not believe that DCI becomes a CRA under the FCRA by virtue of executing those tasks.

The opinions set forth in this informal staff letter are not binding on the Commission.

Sincerely yours,

Clarke W. Brinckerhoff

1. You state, "Since July 1, 1997, health care facilities licensed under 135C of the Iowa Code have been required to conduct criminal history checks and dependent adult abuse checks on all new employees. This applies to organizations such as skilled and intermediate care nursing facilities as well as residential care facilities for the elderly and the mentally retarded. State Law requires the checks must be made through (DCI)."

2. Section 603(f) states:

The term "consumer reporting agency" means any person which, for monetary fees, dues, or on a cooperative nonprofit basis, regularly engages in whole or in part in the practice of assembling or evaluating consumer credit information or other information on consumers for the purpose of furnishing consumer reports to third parties, and which uses any means or facility of interstate commerce for the purpose of preparing or furnishing consumer reports.

3. "[T]he statute is concerned with regulating practices in the credit reporting industry rath-er than with regulating the recordkeeping functions of federal agencies. (Citations omitted). ... Congress did not intend to place federal agencies within the purview of the FCRA." 573 F.2d at 1111.