Maryland fined property manager Bay Management Group $30,000 for requiring a clean criminal background in rental listings, calling it discriminatory. The company must now do non-criminal screening first, then conditional offers, then individualized criminal background assessments. Peter Lohmann argues this shift from objective rules to human judgment reintroduces bias.
Would you rent to a tenant without a clean criminal background check? Bay Management Group in Maryland did not and got in big trouble from the Maryland Attorney General. So Bay Management Group has agreed to pay $30,000 to settle a case with the Maryland Attorney General related to tenant screening. We screen a lot of tenants here at my property management business. Let's break it down. So basically, this is a case about disparate impact. And if you're not familiar with that term, basically, when you are screening tenants either as a landlord or as a property manager, you have to be careful that your screening requirements don't have a disproportionate impact on a protected class. And this is usually brought up in the context of criminal screening or criminal background checks, as it was here. So Bay Management Group had language in their rental listings that said something along the lines of, you must have a clean criminal background check. And the Maryland Attorney General came in and said, we don't really like the language that you're using here. We feel that it's discriminatory and illegal, and we think you should get in big trouble. And so They basically brought a case against them, and in the end, they settled for $30,000. BMG, Bay Management Group, by the way, has many, many thousands of doors under management. They're a big company. Now BMG has to follow a three-step screening process. They have to do non-criminal screening first, send a conditional offer to rent if they pass that non-criminal screening, and then and only then can they do a background check with individual assessment if something turns up. Now I find this a little confusing, and it's frustrating as a property manager who screens hundreds of applicants. Every year, when you get advice like this from attorney generals and many, many, many different federal and state and local jurisdictions all have their own ideas about how tenant screening should be done in a legal way. When they say an individualized assessment, does that mean now that you have an individual human making one-off decisions about rental applicants? That doesn't sound very fair to me. It seems like what you would really want to do is have an objective set of criteria that if the tenant meets those criteria, they're approved. Why are we going back to sort of an individualized assessment? I wanted to do an individualized assessment. That's pretty much what we were doing in the bad old days when a tenant would walk through the door, they would take one look at them and say, hey, we don't have any availability right now based on the way the tenant looks. That's an individualized assessment. Let's not go back to that. Okay. Let's stick with objective criteria that are legal. But I don't like this idea that we're somehow going to go one by one and manually make decisions about an individual's criminal background. That seems like it's going to be ripe for abuse, bias. I just, I don't agree with that. So interesting case here. Glad to see it got settled. $30,000 is Honestly, a slap on the wrist for somebody like BMG, but frankly, I'm glad it wasn't worse because I don't really know that clean criminal background check required in a rental listing is, is a big deal. What do you think?
