City demands that Lyft replace background checker

The Emanuel administration is demanding that Lyft replace its background checker, review all of its drivers and conduct random audits with results shared with the city after acknowledging that one of its drivers had a federal conviction for aiding terrorism.

Raja L. Khan did not get through a background check conducted by Uber, Lyft’s chief competitor in the fast-growing ride-hailing industry.

But Khan’s conviction and 7-year sentence somehow managed to escape the attention of Sterling Talent Solutions, the company Lyft hired to conduct its criminal background checks.

The embarrassing oversight was first reported by WGN-TV.

Business Affairs and Consumer Protection Commissioner Rosa Escareno responded to the story by firing off a letter to Lyft that made a series of demands.

They include: identifying a “new third-party vendor to conduct thorough and accurate background checks”; conducting a new and thorough review of all of its drivers; “establishing a process by which the city receives a list of those drivers who fail the criminal background check, and conducting random audits with results also shared with the city.

Escareno said she has demanded that Lyft identify a replacement for Sterling, but only after the company conducts a new and more thorough criminal background check of all 27,000 of its active drivers.

“We will not stand for a company that is not compliant with the most important part of this ordinance: to protect the public,” the commissioner said.

“They must re-check every single driver. I want Lyft to re-trace every aspect of this process and identify exactly where the breach happened,” she said. “I need to make sure the breach has been fixed. I believe the rest of their drivers are fine. But if there’s an additional problem, they need to reveal that to me.”

Lyft has apologized for the oversight, deactivated Khan and pledged to “conduct background check audits in Chicago” and share the results with City Hall.

The company is also re-evaluating Sterling with an eye toward finding a new company to check the criminal backgrounds of its drivers.

“The safety of our passengers and drivers are of utmost importance to Lyft. . . . We agree that an error was made and we are fully committed to enhancing the safeguards designed to prevent such incidents in the future,” Lyft wrote.

But the letter also states, “Changing providers is no small task, both administratively and given the consequences such a decision has for our riding public.”

Lyft’s letter to the city states that Sterling “believes that it followed all legal requirements and industry best practices in conducting background checks for Chicago drivers.”

Ald. Anthony Beale (9th) begged to differ. The alderman accused Sterling of “totally dropping the ball” and demanded that Lyft “fire that company immediately.”

“Lyft told me this guy was convicted of funneling money to terrorist groups,” Beale said Thursday.

“They called and said this is something that they’re definitely ashamed of and it’s not their policy to let this kind of stuff slip through the cracks. It slipped through the cracks because these background checks are being outsourced. The company they’re outsourced to dropped the ball. They need to be removed immediately.”

Beale is the City Council’s champion for the taxicab industry. He has received thousands of dollars in contributions from the struggling industry.

Earlier this month, he backed off from his threat to require ride-hailing drivers to be fingerprinted and stop surge-pricing by Uber and Lyft.

Both measures were held in the Beale-chaired Transportation Committee pending negotiations on a comprehensive package that could level a regulatory playing field that, he claims, is still tilted in favor of Uber and Lyft.

On Thursday, Beale said the Lyft oversight “definitely doesn’t help their cause. It kind of helps mine. Fingerprinting definitely would have caught this.”

He added, “I’m in full support of fingerprinting. I’m gonna stay on my position. But I still think we need to explore other possibilities if there’s something [else] out there.”

Uber and Lyft have long maintained a background check based on FBI fingerprinting would discriminate against minorities who are “far more likely to have an interaction with the criminal justice system” and often for minor, nonviolent offenses where the charges are dropped but the record has not been expunged.

Mayor Rahm Emanuel wants to raise the 52 cents a ride fee on Uber and Lyft by 15 cents next year and another nickel in 2019 and funnel the money to the CTA to pay for infrastructure projects.