Feds Publish Final Affiliate Marketing Rule

State attorney generals have agreed with the consumer groups, officials write.

“After considering the constructive sharing issue, the [financial institution regulatory] agencies conclude that the statute only covers situations where a person uses eligibility information that it received from an affiliate to make a solicitation to the consumer about its products or services,” officials write.

“In a ‘constructive sharing’ scenario like that described above, a pre-existing business relationship is established between the consumer and the insurance company when the consumer contacts the insurance company to inquire about or apply for insurance products as a result of the consumer’s receipt of the insurance marketing materials,” officials write.

“Because the insurance company does not use shared eligibility information to make solicitations to the consumer before it establishes a pre-existing business relationship with the consumer, the [Fair and Accurate Credit Transactions Act] statute does not apply,” officials write.

If, on the other hand, an insurance company puts consumer eligibility information in a database that all affiliates can access, and a financial institution has the insurer send marketing materials to certain customers, that marketing campaign would not fall within the pre-existing business relationship exception, officials write.

“Instead, the depository institution makes the solicitation because it used eligibility information received from an affiliate to select the consumer to receive a solicitation about its products or services and, as a result, the consumer is provided a solicitation,” officials write.

To try to clarify the scope of the pre-existing relationship exception, the agencies have added examples involving marketing campaigns and consumers who call up asking for directions or other basic information.

“If a consumer calls an affiliate solely to obtain retail hours and directions or solely to opt out, the [pre-existing relationship] exception is not triggered because the communication does not relate to the affiliate’s products or services and making a solicitation about products or services to the consumer in those circumstances would not be a reasonable response to that communication,” officials write.

“The agencies recognize, however, that if the conversation shifts to a discussion of products or services that the consumer may need, solicitations may be responsive depending upon the facts and circumstances,” officials write.

“Likewise, if a consumer who has opted out of an affiliate’s use of eligibility information to make solicitations calls the affiliate for information about a particular product or service, for example, life insurance, solicitations regarding life insurance could be made in response to that call, but solicitations regarding other products or services would not be responsive,” officials write.

A copy of the final rule is available