If Facebook is used to judge creditworthiness, perhaps it could lead to redlining:

If there was any confusion over why Facebook has so vociferously defended its policy of requiring users to display their real, legal names, the company may have finally laid it to rest with a quiet patent application. Earlier this month, the social giant filed to protect a tool ostensibly designed to track how users are networked together—a tool that could be used by lenders to accept or reject a loan application based on the credit ratings of one’s social network…

Research consistently shows we’re more likely to seek out friends who are like ourselves, and we’re even more likely to be genetically similar to them than to strangers. If our friends are likely to default on a loan, it may well be true that we are too. Depending on how that calculation is figured, and on how data-collecting technology companies are regulated under the Fair Credit Reporting Act, it may or may not be illegal. A policy that judges an individual’s qualifications based on the qualifications of her social network would reinforce class distinctions and privilege, preventing opportunity and mobility and further marginalizing the poor and debt-ridden. It’s the financial services tool equivalent of crabs in a bucket...

But a lot of that data is bad. Facebook isn’t real life. Our social networks are not our friends. The way we “like” online is not the way we like in real life. Our networks are clogged with exes, old co-workers, relatives permanently set to mute, strangers and catfish we’ve never met at all. We interact the most not with our best friends, but with our friends who use Facebook the most. This could lead not just to discriminatory lending decisions, but completely unpredictable ones—how will users have due process to determine why their loan applications were rejected, when a mosaic of proprietary information formed the ultimate decision? How will users know what any of that proprietary information says about them? How will anyone know if it’s accurate? And how could this change the way we interact on the Web entirely, when fraternizing with less fiscally responsible friends or family members could cost you your mortgage?

On one hand, there is no indication yet that Facebook is doing this. Is there any case of this happening with online data? On the other hand, the whole point of these social network sites is that they have information that can be used to make money. Plus, they could offer to speed up the approval process for loans if people just given them access to their online social networks. Why do you need mortgage officers and others to approve these things if a simple scan of Facebook would provide the necessary information?

Additionally, given the safety of our data these days, redlining might be the least of our worries…