That Bum Facebook Friend of Yours? Could Cost You a Loan ...

At least that's the headline, Creditworthy? Lenders delve into your social networks. The actual story is more about the possibility than the actuality of it happening. However, knowing that there is a business devoted to perusing social media to prepare "social graphs of your likes, dislikes, strengths and weaknesses" does give one pause.

Rapleaf's web site, the company discussed in the article, emphasizes that it is a marketing company, which is what the article really says about it, notwithstanding the headline.

And of course before an employer could utilize a "social graph of your likes, dislikes, strengths and weaknesses," at least if prepared by a third party, they would do well to check on the requirements of the Fair Credit Reporting Act.

In particular they need to remember that using a consumer report for any employment decision must be preceded by obtaining permission in a very specific way and then following up with very specific notice procedures.

And that a "social graph" seems pretty likely to fit within the definition of a a consumer report which is defined as:

any written, oral, or other communication of any information by a consumer reporting agency bearing on a consumer's credit worthiness, credit standing, credit capacity, character, general reputation, personal characteristics, or mode of living which is used or expected to be used or collected in whole or in part for the purpose of serving as a factor in establishing the consumer's eligibility for (A) credit or insurance to be used primarily for personal, family, or household purposes; (B) employment purposes; or (C) any other purpose authorized under section 604 [§ 1681b].