Bruno's, Inc.; Analysis to Aid Public Comment

FEDERAL TRADE COMMISSION

[File No. 962-3086]

Bruno's, Inc.; Analysis to Aid Public Comment

AGENCY: Federal Trade Commission.

ACTION: Proposed Consent Agreement.

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SUMMARY: The consent agreement in this matter settles alleged

violations of federal law prohibiting unfair or deceptive acts or

practices or unfair methods of competition. The attached Analysis to

Aid Public Comment describes both the allegations in the draft

complaint that accompanies the consent agreement and the terms of the

consent order--embodied in the consent agreement--that would settle

these allegations.

DATES: Comments must be received on or before July 21, 1997.

ADDRESSES: Comments should be directed to: FTC/Office of the Secretary,

Room 159, 6th St. and Pa. Ave., N.W., Washington, D.C. 20580.

FOR FURTHER INFORMATION CONTACT:

Tom Carter, Federal Trade Commission, Dallas Regional Office, 1999

Bryan Street, Suite 2150, Dallas, TX 75201. (214) 979-9350.

SUPPLEMENTARY INFORMATION: Pursuant to Section 6(f) of the Federal

Trade Commission Act, 38 Stat. 721, 15 U.S.C. 46, and Section 2.34 of

the Commission's Rules of Practice (16 CFR 2.34), notice is hereby

given that the above-captioned consent agreement containing a consent

order to cease and desist, having been filed with and accepted, subject

to final approval, by the Commission, has been placed on the public

record for a period of sixty (60) days. The following Analysis to Aid

Public Comment describes the terms of the consent agreement, and the

allegations in the accompanying complaint. An electronic copy of the

full text of the consent agreement package can be obtained from the

Commission Actions section of the FTC Home Page (for May 13, 1997), on

the World Wide Web, at ``http://www.ftc.gov/os/actions/htm.'' A paper

copy can be obtained from the FTC Public Reference Room, Room H-130,

Sixth Street and Pennsylvania Avenue, N.W., Washington, D.C. 20580,

either in person or by calling (202) 326-3627. Public comment is

invited. Such comments or views will be considered by the Commission

and will be available for inspection and copying at its principal

office in accordance with Section 4.9(b)(6)(ii) of the Commission's

Rules of Practice (16 CFR 4.9(b)(6)(ii)).

Analysis of Proposed Consent Order to Aid Public Comment

The Federal Trade Commission has accepted an agreement, subject to

final approval, to a proposed consent order from respondent Bruno's,

Inc.

The proposed consent order has been placed on the public record for

sixty (60) days for reception of comments by interested persons.

Comments received during this period will become part of the public

record. After sixty (60) days, the Commission will again review the

agreement and the comments received and will decide whether it should

withdraw from the agreement and take other appropriate action or make

final the agreement's proposed order.

This matter concerns notification requirements under the Fair

Credit Reporting Act, 15 U.S.C. Sec. 1681. The statute requires, among

other things, that employment applicants, who are denied employment,

either in whole or in part, because of information in consumer reports

obtained from consumer reporting agencies, be provided with the name

and address of the agency making the consumer report. The failure to

provide the notice required by the statute lessens consumers' access to

information that may have led to the denial of employment. Proper

notice assists consumers in discovering inaccurate or obsolete

information in consumer reports that the consumers can subsequently

dispute and correct. The use of consumer reports to assist in

evaluating employment applications has become increasingly popular in

recent years and, consequently, the significance of this notification

requirement has heightened.

The Commission's complaint alleges that Bruno's Inc., has denied

employment applications based, in whole or in part, on information

contained in consumer reports, failed to advise such job applicants

that the denial was based in whole or in part on information contained

in a consumer report, and failed to supply such applicants with the

name and address of the agency making the report, as required by

Section 615(a) of the Fair Credit Reporting Act, 15 U.S.C.

Sec. 1681m(a). The compliant also alleges that the failure to advise

these job applicants constitutes a violation of Section 615(a) of the

Fair Credit Reporting Act, 15 U.S.C. Sec. 1681m(a). The complaint

further alleges that, pursuant to Section 621(a) of the Fair Credit

Reporting Act, 15 U.S.C. Sec. 1681s, a violation of Section 615(a)

constitutes an unfair or deceptive act or practice in violation of

Section 5(a)(1) of the Federal Trade Commission Act, 15 U.S.C.

Sec. 45(a)(1).

The proposed consent order contains provisions designed to prevent

the respondents from engaging in similar acts and practices in the

future.

Part I of the consent agreement requires Bruno's, Inc., to cease

and desist failing to provide the notice required by Section 615(a) to

employment applicants whose applications were denied in whole or in

part because of information in a credit report. Part I provides that

Bruno's, Inc., may not be held liable for the failure to provide such

notices if it demonstrates by a preponderance of evidence that it

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had instituted reasonable procedures to comply with Section 615(a).

Paragraph II requires Bruno's to maintain documents demonstrating

its 615(a) compliance for a period of five years from the issuance date

of the order and to make the documents available upon request to the

FTC for inspection and copying. Paragraph III requires Bruno's to

deliver copies of the Order, at least once per year for a period of

five years from the date of issuance, to all persons responsible for

its compliance. Paragraph IV requires Bruno's to notify the Commission

within 30 days of changes in corporate structure for the duration of

the order. Paragraph V provides for the filing of a compliance report

with the Commission within 60 days of the issuance date of the order.

Finally, Paragraph IV contains a sunset provision, which terminates the

order 20 years after issuance.

The purpose of this analysis is to facilitate public comment on the

proposed consent order. It is not intended to constitute an official

interpretation of the agreement and proposed order or to modify in any

way their terms.

Donald S. Clark,

Secretary.

[FR Doc. 97-13150 Filed 5-19-97; 8:45 am]

BILLING CODE 6750-01-M