Many employers have third-party services run background checks on applicants, new hires, or existing employees. Many of these employers utilize these services to minimize the risk of claims of negligent hiring or discrimination. Even if a reputable service is used, there are challenges and significant legal risks involving the failure to comply with the federal Fair Credit Reporting Act (FCRA). Employers that violate the FCRA may be liable for actual damages sustained by individual applicants, statutory damages ranging between $100 and $1,000 per individual violation, punitive damages, and plaintiffs’ attorneys’ fees and costs. As a result, the FCRA is the source of one wave of class actions sweeping the country, a wave fueled by statutes that favor both plaintiffs (who need not even show they were harmed by a violation in order to file a lawsuit) and their attorneys, and recent headlines announcing million-dollar settlements.