We'd like to develop a database of fraud cases to be used and shared by all of our affiliate banks, but I'm not sure of the regulatory restrictions on this type of sharing.

It would be used for fraud investigations and loss prevention, but due to the nature of the information, it could possibly impact credit decisions. It wouldn't be used for marketing purposes.

Most of the data would be direct transaction and experience information, so according to the FCRA it could be shared among affiliates without any form of opt out. However, there would likely be some other information on the database too. For example, in a fraud investigation there will likely be information about accounts that the customer has at other banks or the fact that the customer is in default on loans at other banks. Could this information be shared among affiliates without the need for some type of customer opt out?

Thanks.

In order to share information with affiliates you must register with FINCEN a "Notice of for Purposes of Subsection 314(b) of the USA Patriot Act and 31 CFR 103.110. You can print off a form from www.fincen.gov and mail to FINCEN, P O Box 39, Mail Stop 100, Vienna, VA 22183 This must be resubmitted annually.

I do not think the FinCEN filing was related to the type of fraud information sharing mentioned in the post. That is only for 314 purposes.

If T&E is being shared, you should be ok under FCRA. Further, Reg. P (GLB Privacy) permits sharing for security purposes.

I think the GLB privacy regulation (Reg P) only covers sharing with nonaffiliated third parties and defers to the FCRA for affiliate sharing. I think the only impact from a Reg P perspective is that the privacy notice must accurately describe the bank's sharing practices.

You mentioned that If T&E is shared, we should be ok under FCRA. But I think there will very likely be information in the fraud investigation database that will go beyond T&E. Does the FCRA prohibit the sharing of that additional information with affiliates for purposes of fraud investigations? Thanks.