Uber faces $8.9M fine
Colorado regulators say the ridesharing service allowed felons to drive.
Colorado regulators slapped Uber with an $8.9 million penalty for allowing 57 people with past criminal or motor vehicle offenses to drive for the company, the state’s Public Utilities Commission announced Monday.
The PUC said the drivers should have been disqualified. They had issues ranging from felony convictions to driving under the influence and reckless driving. In some cases, drivers were working with revoked, suspended or canceled licenses, the state said. A similar investigation of smaller competitor Lyft found no violations.
“We have determined that Uber had background-check information that should have disqualified these drivers under the law, but they were allowed to drive anyway,” PUC director Doug Dean said in a statement. “These actions put the safety of passengers in extreme jeopardy.”
Uber spokeswoman Stephanie Sedlak provided this statement on Monday:
“We recently discovered a process error that was inconsistent with Colorado’s ridesharing regulations and proactively notified the Colorado Public Utilities Commission (CPUC). This error affected a small number of drivers and we immediately took corrective action. Per Uber safety policies and Colorado state regulations, drivers with access to the
Uber app must undergo a nationally accredited third-party background screening. We will continue to work closely with the CPUC to enable access to safe, reliable transportation options for all Coloradans.”
The PUC’s investigation began after Vail police referred a case to the agency. In that case, which occurred in March, an Uber driver dragged a passenger out of the car and kicked him in the face, according the Vail police report.
In August, the PUC asked Uber and Lyft for records of all drivers who were accused, arrested or convicted of crimes that would disqualify them from driving for a transportation network company, the term given to ridesharing services under state law.
“Lyft gave us 15 to 20 (records), but we didn’t find any problems with Lyft,” Dean said.
Uber handed over 107 records and told the PUC that it had removed those people from its system.
The PUC cross-checked the Uber drivers with state crime and court databases, finding that many had aliases and other violations. While 63 were found to have issues with their driver’s licenses, the PUC focused on 57 who had additional violations, because of the impact on public safety.
“What they (Uber) calls proactively reaching out to us was after we had to threaten them with daily civil penalties to get them to provide us with the (records),” said Dean, adding that his prime investigator just told him that some penalized drivers were still on the Uber system. “This is not a data processing error. This is a public safety issue.”
Uber was welcomed to Colorado in June 2014, when Gov. John Hickenlooper signed Senate Bill 125 to authorize ridesharing services such as Uber and Lyft. The PUC was then charged with creating rules to regulate the services, which went into effect on Jan. 30, 2016.
The rules gave the companies the choice of either fingerprinting drivers or running a private background check on the potential driver’s criminal history and driving history. Drivers also must have a valid driver’s license.
Drivers are disqualified if they’ve been convicted of a felony in the past five years. But they can never be a driver if they’ve been convicted of serious felonies including felony assault, fraud, unlawful sexual behavior and violent crimes, according to the statute.
Taxi drivers, by comparison, are subject to fingerprint background checks by the FBI and Colorado Bureau of Investigation.
Elsewhere in the U.S., Uber and Lyft have threatened to leave places that force them to fingerprint drivers — including in Chicago, Maryland and Houston.
Both companies pulled out of Austin last year after the city added rules to fingerprint drivers. But the Texas house passed a bill in April removing such requirements, and Uber and Lyft returned to the city.
While Maryland caved in its requirements after Uber threatened to leave, the state banned 4,000 ridesharing drivers in April who did not meet state screening requirements despite passing Uber or Lyft’s background checks.That also happened in Massachusetts, which kicked out 8,200 drivers who had passed company checks. Among them were 51 registered sex offenders.
Uber and Lyft have pushed for private background checks because they say that fingerprints don’t provide the complete source of criminal history that some expect. In a post about its security process, Uber said that when it comes to fingerprints, there are gaps between FBI and state arrest records, which can result in an incomplete background check. Uber, instead, uses state and local criminal history checks plus court records and the U.S. Dept. of Justice’s National Sex Offender site.
Last month, California regulators nixed any fingerprinting requirement as long as Uber and Lyft conduct their own background checks.
But the Colorado PUC says that by fingerprinting drivers, the ride service would be able to identify drivers with aliases and other identities with felony convictions. The lack of fingerprinting never sat well with Dean, who mentioned his concern in 2014 before Colorado passed the law.
“They said their private background checks were superior to anything out there,” Dean said. “We can tell you their private background checks were not superior. In some cases, we could not say they even provided a background check.”
Vail police said that altercations between passengers and drivers are not uncommon. They’re not limited to Uber drivers but include taxi and limo drivers and passengers, said Vail police Detective Sgt. Luke Causey.
“We’ve had more than one,” Causey said. “Unfortunately, in our winter environment with guests and around bar closing times, we’ve had the driver go after passengers who don’t pay their tab. Sometimes it can go both ways.”
Uber drivers have made local headlines for bad behavior. In July, a Denver Uber driver pleaded guilty to disturbing the peace after rolling his car on the leg of a city parking attendant at Denver International Airport. Two years ago, a Denver UberX driver was arrested for trying to break into the home of a passenger he’d just dropped off at the airport.
Monday’s fine is a civil penalty assessment and based on a citation of $2,500 per day for each disqualified driver found to have worked. Among the findings, 12 drivers had felony convictions, 17 had major moving violations, 63 had driver’s license issues and three had interlock driver’s licenses, which is required after a recent drunken driving conviction.
Uber has 10 days to pay 50 percent of the $8.9 million penalty or request a hearing to contest the violation before an administrative law judge. Afterwards, the PUC will continue making audits to check for compliance. If more violations are found, Uber’s penalty could rise.
“Uber can fix this tomorrow. The law allows them to have fingerprint background checks. We had found a number of a.k.a.’s and aliases that these drivers were using. That’s the problem with name-based background checks,” Dean said. “We’re very concerned and we hope the company will take steps to correct this.”