If a potential independent contractor fails a background check (long criminal history), what am I required to tell him/her? Does this fall under the rules of the Fair Credit Reporting Act?

Did you fail to contract them due to their credit history? Normally you merely tell them nothing unless you already agreed to contract with them,

I would assume they know what is on their history. Is it a issue that could be a error or mistake, do you want to contact them and ask them to explain or clarify the issue.

Due to extensive criminal history. They are wondering what their status is. Can I tell them "due to your extensive criminal history, we can't contract you"..?