RentGrow, a Massachusetts-based tenant screening company, has agreed to pay a $2.25 million civil penalty to settle allegations from the Federal Trade Commission that it violated the Fair Credit Reporting Act and the FTC Act, according to a complaint and proposed stipulated order filed yesterday by the Department of Justice in federal court in Washington, D.C.
The big picture: The case is a roadmap of what regulators expect from consumer reporting agencies operating as resellers, and a warning that “we just displayed what the vendor sent us” is not a defense. The FTC alleged RentGrow’s formatting choices alone made accurate vendor data misleading.
The details: The complaint alleged that RentGrow, which sells tenant screening reports to landlords and property managers through its ScreeningWorks Pro product, failed to maintain reasonable procedures to assure maximum possible accuracy. The company allegedly listed the same criminal conviction or eviction proceeding multiple times, making applicants appear to have longer records than they actually had. In one disputed report, RentGrow listed 15 criminal charges across seven records for one applicant. When the consumer disputed the report, all 15 were removed and the applicant’s denial was reversed to an acceptance.
The FTC also alleged that RentGrow:
- Failed to tell consumers requesting their file that LexisNexis Accurint was a source of address history and middle name data, even when that data provided the crucial link matching a public record to the consumer
- Routinely labeled certain disputes “invalid” and took no further action, rather than investigating or forwarding them to the furnishing agency as the FCRA’s reseller provisions require
- Told consumers who successfully disputed information that the property where they applied had been notified of the update, while the notice sent to the landlord said there were no changes to the screening result
The complaint says RentGrow received disputes about duplicate records since at least 2018 but did not change its practices until after the FTC opened its investigation.
What the order requires: Beyond the $2.25 million penalty, RentGrow is prohibited from reporting a criminal or eviction proceeding more than once, must disclose vendors like LexisNexis Accurint in file disclosures, must comply with reseller dispute requirements, and cannot misrepresent whether landlords have been notified of post-dispute changes. The order includes a one-year compliance report, 10 years of recordkeeping, and terminates after 10 years.
Read the complaint. Read the consent order.
