Zach Wilson, right, inspects an Uber driver's car in Frisco, Colo. on Friday, Nov. 20, 2015.

(Nathaniel Minor/CPR News)

The Colorado Public Utilities Commission announced Monday it’s fining an Uber subsidiary nearly $9 million for allowing drivers with criminal or motor vehicle offenses to drive for the company.

PUC investigators identified 57 drivers in the last year and a half who should not have been allowed on the platform under state law, according to a press release:

Among the findings of the investigation were 12 drivers with felony convictions; 17 drivers with major moving vehicle violations; three drivers with interlock driver’s licenses, which are required after recent drunk driving convictions; and 63 drivers with driver’s license issues.

“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.”

Colorado was one of the first states in the country to regulate ride-hailing companies like Uber and Lyft. Legislation mandates that Transportation Network Companies, as they are called here, conduct background checks and pull a driving history reports for any would-be drivers. The contractors also must have a valid driver’s license.

In an interview, Dean said companies can choose between a government-conducted fingerprint background check or a background check done by a private company. Uber uses the latter, Dean said.

"When Uber came to Colorado they said their private background checks they conducted were industry leading and were in fact better than fingerprint background checks,” he said. “I didn't agree with that, but we were not able to get the legislation amended."

The PUC said it began its investigation after hearing from the Vail Police Department that an Uber driver was accused of assaulting a passenger in 2016. PUC investigators asked Uber to turn over records of any drivers accused, arrested, or convicted of a crime that would disqualify them from driving.

Dean said the company initially declined to cooperate and only turned over the records after being threatened with a fine. Of the 107 records turned over to the PUC, 57 were found to have disqualifying offenses.

Rasier, LLC, an Uber-owned subsidiary, was fined $2,500 a day for each driver that worked when they shouldn’t have. Dean said those added up to the largest fine the PUC has ever issued.

After the PUC issued their press release, an Uber spokesperson sent this statement:

“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.”

Dean said the PUC did not find similar issues at Lyft.
 
Uber could resolve the case by paying only half the fine in the next 10 days. Otherwise, it can request a hearing before an administrative law judge to contest the fine.

CPR’s Mike Lamp contributed to this report.