News reports in the last day reveal that Facebook has obtained a patent on a method for "authenticating an individual for access to information or service based on that individual's social network." What exactly does that mean?
Among other things, the patent says, the invention could be used by lenders as follows: "When an individual applies for a loan, the lender examines the credit ratings of members of the individual's social network who are connected to the individual through authorized nodes. If the average credit rating of these members is at least a minimum credit score, the lender continues to process the loan application. Otherwise, the loan application is rejected."
Wow. Could lenders really use the credit of a person's Facebook friends to deny that person a loan? The CNN Money report linked to above points out that denying credit for that reason might violate the Equal Credit Opportunity Act. In addition, accessing a consumer's credit report (without her consent) in order to determine the creditworthiness of another consumer probably wouldn't be a legitimate business reason for access under the Fair Credit Reporting Act. Thus, under the current state of U.S. law, Facebook's invention may not actually be usable for loan processing.
So you probably don't need to ask the next person who wants to be your Facebook friend to tell you his credit score. Yet.