Checkr Inc., the unofficial background check provider for the gig economy, is valued at $2.2 billion after raising a total of $310 million in funding, Forbes reported today.
The San Francisco-based tech company, which has received criticism for years for the quality of its background checks, recently raised $160 million in a round of venture funding from investors including T. Rowe Price, Mary Meeker’s Bond Capital and Coatue Management. Checkr, which provides background checks to Uber, Lyft and other gig-economy companies, plans to use those funds to expand beyond the United States and Canada, according to Forbes.
Big If True reported last month that at least dozens of workers have been fired or rejected from gig-economy jobs based on flawed background checks from Checkr. Federal lawsuits show that Checkr’s background checks reported multiple applicants had been convicted of or charged with crimes they didn’t commit.
Last year, Checkr settled a class action suit regarding its background check practices for $4.5 million, plus attorney’s fees. The lawsuit alleged the company gave three different companies three different reports for a single applicant, whose report illegally included minor traffic violations older than seven years.
But most of the attention on Checkr’s background checks has been due to what they miss.
Uber and Lyft have faced criticism for years for their background checks, which approved workers with criminal histories that critics say should have prevented their hiring.
On Monday, KGW in Portland reported that the Portland Bureau of Transportation revoked or suspended the drivers’ permits of 168 Lyft and Uber drivers due to criminal or driving history.
Checkr’s background checks run applicants’ social security numbers and names against multiple databases, but law enforcement experts say this approach is inferior to fingerprint background checks, which are considered more accurate. After suing Uber over its background check system in 2014, San Francisco District Attorney George Gascón said that background checks that weren’t based on fingerprints were “completely worthless.”
Uber settled that suit for $10 million in 2016.
Contact Big If True editor Mollie Bryant at 405-990-0988 or bryant@bigiftrue.org. Follow her on Facebook and Twitter.
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