Dear Consumer Ed:

I attempted to reload a restaurant gift card. After providing my credit card number, expiration date and 3-digit code, I was then prompted with three questions: The street number of my residence on a street that I lived on several years ago, the type of residence I live in on my street, which was given by name, and what street I have lived on in the past out of 4 choices. The processor must have accessed my credit report. Is this legal? 

Consumer Ed Says:

Yes, this is likely legal under the Fair Credit Reporting Act, as well as the terms and conditions of the gift card that you used.

The Fair Credit Reporting Act (FCRA) limits the manner (and the reasons) in which a consumer's credit report may be accessed. The Act is designed to protect the privacy of consumers' information, and to guarantee that the information supplied by credit reporting agencies is as accurate as possible. Under the FCRA, there must be a permissible and legitimate purpose for a business to check your credit report. For example, a business may access your report if you are applying for credit and it needs to check your creditworthiness, or if you already hold an account with a business and it needs to determine if you continue to meet the terms of the account.

A business can also access your report if it has a legitimate need for the information in relation to a business transaction that you initiate. In your case, by using and then reloading the restaurant gift card, you can be said to have initiated a transaction with this business. The business may have obtained this information about you in order to verify your identity before completing the transaction. As long as the information is not misused or mishandled, identity verification of a consumer helps to stop fraud and identity theft, and may be deemed to be for a legitimate purpose. 

Additionally, the terms and conditions of the gift card you purchased may give the business the right to check your information. Often in those terms and conditions, a business will expressly retain the right to access information about you for identity verification and for fraud prevention. If your gift card is subject to such a provision, then when you began to use the gift card you may have given the business permission to check your personal information, and to verify your identity.

If you still have questions about how or why the business accessed your information, you could try the following:


  • Check the terms and conditions of the gift card you purchased to see whether you have authorized the business to check your information; or   
  • Ask the company directly how they obtained your information and what steps they take to ensure your private information is protected.


If you aren't satisfied with the business' response to your questions, or feel they are misusing your personal information, then you can always simply take your business elsewhere. 

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