LEGAL GUIDE
Written by attorney W. Scott Hanken | Feb 20, 2011

Retail Theft - The Implications of The NMRA Retail Theft Database

If you have been prosecuted for retail theft or theft from a retailer in the course of your employment or in many cases just arrested or charged the Retail Theft Database can substantially impact your ability to secure employment. The database was created and is marketed to Retailers as follows:

The National Retail Mutual (NRMA) Retail Theft Database is a unique product that was designed to stem the tide of inventory loss by creating a partnership of retailers through information sharing that goes beyond criminal background checks.

How are Retailers able to do this?

The FCRA (Fair Credit Reporting Act), Title 15, of the United States Code, Section 1681 et seq, to include the amendments contained in the Consumer Credit Reporting Reform Act (CCRRA) of 1996 effective September 30, 1997, provides the framework for the accumulation and dissemination of employment-related information for employment purposes. Therefore, under the act, NRMA is defined as a “consumer reporting agency" or CRA. As such, NRMA must adhere to certain statutorily prescribed procedural standards. The FCRA requires that every consumer-reporting agency adopt “reasonable procedures" to reduce the risk of error and to assure that the reports which it issues are used for a proper purpose. The FCRA also requires each consumer-reporting agency to establish standards and procedures that assure all consumers of the right to request that any incorrect or inaccurate reports be promptly corrected or clarified.

What rights do applicants have?

Should an employer deny employment based on the results that were provided to them by NRMA, a copy of the report in question and a copy of the consumer’s rights under the FCRA must be provided to an applicant for hire along with notification that adverse action may be taken – based in whole or in part on information contained within the NRMA consumer report. The applicant is then given a reasonable period of time to dispute the findings of the report with the Consumer Reporting Agency. After this “reasonable" amount of time has passed, a second letter should be sent to the applicant explaining to them that they are not eligible for hire based upon the information provided to the employer by the Consumer Reporting Agency. This is commonly referred to as the Adverse Action process.

What information is utilized to create the database?

NRMA does not report solely on individuals ‘arrested’ for theft. If a specific case has been referred for criminal prosecution, it may be reported to NRMA provided a signed admission or restitution statement has been secured, and in many states, this information may be used while the case is ‘pending.’

Employees and shoplifters who sign an admission statement may be reported, whether the matter was referred for criminal prosecution or not. If no admission statement was obtained, then the incident must be referred for criminal prosecution (police case number assigned) before it may be submitted to NRMA.

Does an individual have to be convicted of a crime before NRMA can utilize the information?

No. Legislation does not restrict the use of signed admission statements in making hiring decisions. For that reason, a signed admission statement can be used solely as a basis for hiring.

How long does information stay in the NRMA database?

NRMA only reports incidents that have occurred within the last 7 years of the report date. All reports are accessible in real-time online for viewing the most recent 7 year period.

Are Juveniles reported to NRMA?

No, the NRMA Retail Advisory Board unanimously voted to not include incidents in which the person was under the age of 18 when the theft incident occurred

What kind of theft cases are reported to NRMA?

NRMA is limited to incidents involving theft of merchandise, cash, or company property. Employees terminated for non-fraudulent reasons or terminated for violation of company policy not related to theft are not accepted for inclusion with NRMA data.

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