Employment Denial due to credit

One of our supervisors interviewed a young man last week and felt he would be a good fit for the position she was filling...until we received his credit report. He had completed an authorization for us to run a credit and background check. After looking at his credit report it was decided it would be too much of a risk (we are a bank and it was a position with too much access). The supervisor emailed the applicant and told him she would not be able to hire him due to his credit.

What procedure do we need to follow now? I think we have to mail a denial letter along with a copy of his credit report. I have read a couple places that we should send those separately though. Just a little uncertain of what procedure we need to follow. We don't typically send denial letters.

Also, if anyone knows a good place to get a sample denial letter or has one they would want to share that would be helpful.



  • 2 Comments sorted by Votes Date Added
  • As far as I know, you have to follow the same Fair Credit Reporting Act rules for denial of employment based on credit history as you do for denying a loan based on credit history.I've only done it once, but we had to send out a first letter before actually denying employment, saying that we'd found this negative information on the person's credit report and offering them a chance (within a certain number of days) to let us know if the information on the credit report wasn't correct. We included a copy of the credit report in the letter, along with the information about the agency that provided the credit report. When we didn't hear back from them in the allotted time period, then we sent out a second letter actually telling them that they weren't getting the job because of their credit report.

    We are also a bank, so at the time we did this, I got all the FCRA information from our loan department and did the letters based upon the letters they send out when denying a loan applicant based on their credit report. Assuming you are a lending institution, you should be able to do the same thing and get the information you need on how to handle this situation should it ever arise again.
  • Great...thanks for the information!
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