As a point of reference, here’s the equivalent prospectuses and an example sales report from Prosper. Prosper doesn’t seem to publicly disclose a borrower’s employer or city, only an job category and a state. Prosper’s freeform loan descriptions are more detailed and the borrower sometimes refers to a location, but the aggregate information is still not generally enough to identify the borrower, and never is unless the borrower over-discloses. I am not affiliated with either service.
Here’s the email to Lending Club (August 21, 2012) and their reply (September 6, 2012):
If your loan is funded, Lending Club must publicly disclose certain information about you as part of public SEC filings. This includes employer, year hired, city, income, loan reason, and credit information. Click here to see examples of Lending Club loan disclosures.
I’m spending the time to write all of this down because I want to see peer-to-peer lending and Lending Club succeed, so please let me know if I can clarify anything here. Here’s more details about the 2 discrepancies:
Personal but not personally identifiable information about borrowers is contained in loan listings that can be viewed by all users and is filed with the Securities and Exchange Commission and as such is made publicly available.
This is inaccurate. Using the information on Lending Club’s sales reports, I could personally identify many individual borrowers, and take an educated guess about many more. In some cases this would take a bit of existing information, such as from discovering a loan request from a co-worker based on their listed employer. I can almost guarantee that another employee of Friendship Public Charter School, Reis Law, pair Networks, Fundly, and many other small- and mid-size employers listed on the 2012-08-21 sales report could name the borrower using only information from the report.
In other cases, the combination of employer, year hired, city, income, and freeform text description is enough for a stranger to identify them using relatively simple Google, LinkedIn, or Facebook searches. For many companies, the combination of those fields is unique throughout the whole company. It’s often very unique, like because only a few people were hired in a given year. Also, the “Earliest credit line” field is often a reasonable proxy for the borrower’s age, and is at least a minimum age.
In those cases, a single external corroboration such as a LinkedIn job announcement, a title transfer on BlockShopper, or a Facebook photo posted to the company’s page could be enough to attach a name.
The credit score information is both public and disclosed alongside other information which is personally identifiable. The data disclosure section says:
Qualified Lending Club investors will also see certain credit data collected from or calculated based on your credit bureau file. It is necessary to allow prospective investors to see this information as they evaluate your loan request. The information displayed to investors includes a credit profile section and a credit history section. As noted above, this information is also contained anonymously in loan data files available on the statistics page.
It goes on to define the fields disclosed as part of the credit profile and the credit history.
It doesn’t say that the credit information is disclosed alongside lots of other personal data. Even when that information is not enough to be personally-identifiable (discrepancy #1 above), it’s public and visible to anyone. It’s not visible only to “Qualified Lending Club investors,” and perhaps more importantly, the disclosure is not on a loan-by-loan basis. In reading the paragraph above, I would interpret it to say that my information will be temporarily disclosed to all qualified lenders (prospective investors) while my loan is being funded, then will be only shown to those lenders who actually funded my loan. That isn’t the case.
Reply from Mark D’Arrigo, Associate Counsel, Lending Club:
Although we disagree with your conclusions and interpretations, we appreciate your email and thank you for your feedback. We periodically review our consumer privacy policies and processes and will take your specific suggestions under consideration as part of that review process. Thank you very much for your time and your interest in Lending Club.