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Compliance Tips for affiliate marketing
WASHINGTON(5/16/08)—The compliance folks of the Credit Union National Association (CUNA) remind credit unions that the Fair and Accurate Credit Transactions Act’s (FACTA) affiliate marketing rules only apply when credit unions and their credit union service organizations (CUSOs) share “eligibility information” for marketing purposes. Eligibility information includes a person’s transaction and experience information, such as account history, with the credit union or affiliate, and certain “other” information submitted on consumer reports and applications. Beginning on Oct. 1, if a credit union shares eligibility information with an affiliated CUSO, the CUSO cannot use that information to make a solicitation for marketing purposes, unless three conditions exist:
* A consumer must be provided with a notice that the information may be used for marketing solicitations. * An individual must be given a reasonable opportunity to “opt-out” of these solicitations. * A consumer must not have “opted out.”
A credit union or CUSO would not have to comply with these requirements for marketing communications directed to the general membership since no eligibility information sharing is involved. Additionally, affiliates may “constructively share” eligibility information without triggering the affiliate marketing rules. One possibility is where an affiliated CUSO develops specific eligibility criteria without using any information received from the credit union. The CUSO provides its criteria to the credit union, and asks the credit union to identify members that meet the criteria, and send the CUSO’s marketing materials to those members. When a member returns a coded response form to the CUSO, the member’s response provides the CUSO with discernible eligibility information. For more compliance gems, use the resource link below to visit CUNA’s Compliance Challenge.


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