CFPB’s Advisory Opinion on Name-Only Matching for Consumer Reporting

On July 12, 2022, the Consumer Financial Protection Bureau (CFPB) issued an advisory opinion related to the Fair Credit Reporting Act (FCRA) that included a warning to consumer reporting agencies not to use name-only matching procedures for information provided in a consumer report.

The CFPB’s position is that name-only matching procedures violate the permissible purpose requirement in FCRA section 604(a)(3); that is, a consumer reporting agency may only furnish a consumer report under certain specific circumstances listed in the FCRA. SI typically relies on the requirement that our reports will be used solely for employment purposes.

The CFPB further warned that including a disclaimer in the report, such as “this record was matched to the subject by First Name, Last Name ONLY and may not belong to your subject; your further review of the [source] is required in order to determine if this is your subject” does not adequately address the problem of using name-only matching procedures because the report may include information about a person other than the person for whom the CRA has a permissible purpose. In the CFPB’s view, a disclaimer “will not change the fact that the consumer reporting company has failed to satisfy the requirements of 604(a)(3) and has provided a consumer report about a person lacking a permissible purpose with respect to that person.”

A CFPB advisory opinion reflects the position of the CFPB that it will take in its investigations and enforcement actions, and courts are supposed to defer to an agency’s interpretation of the laws that it administers.