[Federal Register Volume 78, Number 11 (Wednesday, January 16, 2013)]
[Notices]
[Pages 3425-3427]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2013-00744]


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FEDERAL TRADE COMMISSION

[File No. 112 3195]


Filiquarian Publishing, LLC; Choice Level, LLC; and Joshua Linsk; 
Analysis of Proposed Consent Order 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 and the terms of the consent order--embodied in the consent 
agreement--that would settle these allegations.

[[Page 3426]]


DATES: Comments must be received on or before February 11, 2013.

ADDRESSES: Interested parties may file a comment at https://ftcpublic.commentworks.com/ftc/filiquarianconsent online or on paper, 
by following the instructions in the Request for Comment part of the 
SUPPLEMENTARY INFORMATION section below. Write ``Filiquarian, File No. 
112 3195'' on your comment and file your comment online at https://ftcpublic.commentworks.com/ftc/filiquarianconsent by following the 
instructions on the web-based form. If you prefer to file your comment 
on paper, mail or deliver your comment to the following address: 
Federal Trade Commission, Office of the Secretary, Room H-113 (Annex 
D), 600 Pennsylvania Avenue NW., Washington, DC 20580.

FOR FURTHER INFORMATION CONTACT: Jessica Lyon (202-326-2344), FTC, 
Bureau of Consumer Protection, 600 Pennsylvania Avenue NW., Washington, 
DC 20580.

SUPPLEMENTARY INFORMATION: Pursuant to Section 6(f) of the Federal 
Trade Commission Act, 15 U.S.C. 46(f), and FTC Rule 2.34, 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 thirty (30) days. The 
following Analysis to Aid Public Comment describes the terms of the 
consent agreement, and the allegations in the complaint. An electronic 
copy of the full text of the consent agreement package can be obtained 
from the FTC Home Page (for January 10, 2013), on the World Wide Web, 
at http://www.ftc.gov/os/actions.shtm. A paper copy can be obtained 
from the FTC Public Reference Room, Room 130-H, 600 Pennsylvania Avenue 
NW., Washington, DC 20580, either in person or by calling (202) 326-
2222.
    You can file a comment online or on paper. For the Commission to 
consider your comment, we must receive it on or before February 11, 
2013. Write ``Filiquarian, File No. 112 3195'' on your comment. Your 
comment--including your name and your state--will be placed on the 
public record of this proceeding, including, to the extent practicable, 
on the public Commission Web site, at http://www.ftc.gov/os/publiccomments.shtm. As a matter of discretion, the Commission tries to 
remove individuals' home contact information from comments before 
placing them on the Commission Web site.
    Because your comment will be made public, you are solely 
responsible for making sure that your comment does not include any 
sensitive personal information, like anyone's Social Security number, 
date of birth, driver' license number or other state identification 
number or foreign country equivalent, passport number, financial 
account number, or credit or debit card number. You are also solely 
responsible for making sure that your comment does not include any 
sensitive health information, like medical records or other 
individually identifiable health information. In addition, do not 
include any ``[t]rade secret or any commercial or financial information 
which * * * is privileged or confidential,'' as discussed in Section 
6(f) of the FTC Act, 15 U.S.C. 46(f), and FTC Rule 4.10(a)(2), 16 CFR 
4.10(a)(2). In particular, do not include competitively sensitive 
information such as costs, sales statistics, inventories, formulas, 
patterns, devices, manufacturing processes, or customer names.
    If you want the Commission to give your comment confidential 
treatment, you must file it in paper form, with a request for 
confidential treatment, and you have to follow the procedure explained 
in FTC Rule 4.9(c), 16 CFR 4.9(c).\1\ Your comment will be kept 
confidential only if the FTC General Counsel, in his or her sole 
discretion, grants your request in accordance with the law and the 
public interest.
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    \1\ In particular, the written request for confidential 
treatment that accompanies the comment must include the factual and 
legal basis for the request, and must identify the specific portions 
of the comment to be withheld from the public record. See FTC Rule 
4.9(c), 16 CFR 4.9(c).
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    Postal mail addressed to the Commission is subject to delay due to 
heightened security screening. As a result, we encourage you to submit 
your comments online. To make sure that the Commission considers your 
online comment, you must file it at https://ftcpublic.commentworks.com/ftc/filiquarianconsent by following the instructions on the web-based 
form. If this Notice appears at http://www.regulations.gov/#!home, you 
also may file a comment through that Web site.
    If you file your comment on paper, write ``Filiquarian, File No. 
112 3195'' on your comment and on the envelope, and mail or deliver it 
to the following address: Federal Trade Commission, Office of the 
Secretary, Room H-113 (Annex D), 600 Pennsylvania Avenue NW., 
Washington, DC 20580. If possible, submit your paper comment to the 
Commission by courier or overnight service.
    Visit the Commission Web site at http://www.ftc.gov to read this 
Notice and the news release describing it. The FTC Act and other laws 
that the Commission administers permit the collection of public 
comments to consider and use in this proceeding as appropriate. The 
Commission will consider all timely and responsive public comments that 
it receives on or before February 11, 2013. You can find more 
information, including routine uses permitted by the Privacy Act, in 
the Commission's privacy policy, at http://www.ftc.gov/ftc/privacy.htm.

Analysis of Agreement Containing Consent Order To Aid Public Comment

    The Federal Trade Commission has accepted, subject to final 
approval, an agreement containing a consent order from Filiquarian 
Publishing, LLC; Choice Level, LLC; and Joshua Linsk, individually, and 
as an officer of the companies.
    The proposed consent order has been placed on the public record for 
thirty (30) days for receipt of comments by interested persons. 
Comments received during this period will become part of the public 
record. After thirty (30) days, the Commission will again review the 
agreement and the comments received, and will decide whether it should 
withdraw from the agreement and take appropriate action or make final 
the agreement's proposed order.
    The Commission's proposed administrative complaint alleges that the 
companies were operating as consumer reporting agencies without any 
procedures or policies in place to comply with the Fair Credit 
Reporting Act (``FCRA'').
    The respondents sold background screening reports containing 
criminal records through mobile applications (``apps'') available in 
the iTunes and Google Android store (now GooglePlay) and through a Web 
site. Filiquarian developed and marketed apps that sold for $0.99 each 
and allowed purchasers to conduct unlimited searches of criminal 
history information within a specific geographic area, such as a state 
or county. Each app included an express representation that purchasers 
could use the reports for employment purposes. Choice Level provided 
the underlying records accessed by purchasers of the Filiquarian apps. 
Joshua Linsk is the owner and sole officer of Filiquarian and Choice 
Level. During all times material to this complaint, Linsk, individually 
or in concert with others, formulated, directed, or controlled the 
policies, acts, or practices of the companies.

[[Page 3427]]

    According to the complaint, despite Filiquarian clearly promoting 
its background reports for use in employment screening, both 
Filiquarian and Choice Level included disclaimers in their terms and 
conditions stating that their reports were not to be considered a 
screening product for insurance, employment, or credit, and that they 
were not compliant with the FCRA. Such disclaimers contradicted and 
failed to counteract the express representations made in Filiquarian's 
advertising, urging the use of the reports to screen potential 
employees. Marketing and selling background screening reports to 
potential employers without implementing any of the accuracy or dispute 
safeguards required by the FCRA potentially exposes a large number of 
consumers to harm to their reputations and employment prospects.
    The complaint alleges that the reports produced by respondents were 
consumer reports under the FCRA and that respondents lacked any 
policies or procedures to comply with the FCRA. Specifically, the 
complaint alleges that respondents failed to adhere to three key 
requirements of the FCRA: to maintain reasonable procedures to verify 
who their users are and that the information would be used for a 
permissible purpose; to ensure that the information they provided in 
consumer reports was accurate; and to provide notices to users and to 
those who furnished proposed respondents with information that was 
included in consumer reports. The complaint further alleges that by 
their violations of the FCRA, as stated above, proposed respondents 
have engaged in unfair and deceptive acts and practices, in violation 
of Section 5(a) of the Federal Trade Commission Act, 15 U.S.C. 45(a).
    The proposed consent order contains provisions designed to prevent 
the respondents from engaging in the future in practices similar to 
those alleged in the complaint.
    Part I of the order includes injunctive relief requiring 
respondents to comply with the relevant provisions of the FCRA. Parts 
II through VI are reporting and compliance provisions. Part II requires 
respondents to retain documents relating to their compliance with the 
order for a five-year period. Part III requires dissemination of the 
order now and in the future to persons with responsibilities relating 
to the subject matter of the order. Part IV ensures notification to the 
FTC of changes in corporate status. Part V mandates that respondents 
submit a compliance report to the FTC within 60 days, and periodically 
thereafter as requested. Part VI is a provision ``sunsetting'' the 
order after twenty (20) years, with certain exceptions.
    The purpose of this analysis is to aid public comment on the 
proposed order. It is not intended to constitute an official 
interpretation of the proposed order or to modify its terms in any way.

    By direction of the Commission.
Richard C. Donohue,
Acting Secretary.
[FR Doc. 2013-00744 Filed 1-15-13; 8:45 am]
BILLING CODE 6750-01-P