If a credit reporting agency or consumer reporting business does work that goes beyond ordinary credit reporting (like skip tracing, asset searches, or background investigations) does it need a Georgia private detective license, even though it's exempt from licensure for normal credit reporting work?

Plain-English summary

Georgia regulates the "private detective business" through the Board of Private Detective and Security Agencies. Anyone engaged in the private detective business must be licensed under O.C.G.A. § 43-38-16. The Secretary of State's predecessor asked whether a consumer reporting agency or credit reporting business, which is exempt from this licensure under O.C.G.A. § 43-38-14(a)(2) for activities covered by the federal Fair Credit Reporting Act (FCRA), also needs a license when it does work outside the FCRA's scope.

AG Thurbert Baker said yes.

The broad definition of "private detective business." O.C.G.A. § 43-38-3(3) defines the private detective business as obtaining or furnishing information about:
- (A) crimes or wrongs against the United States or any state or territory;
- (B) the background, identity, habits, conduct, business, employment, occupation, assets, honesty, integrity, credibility, knowledge, trustworthiness, efficiency, loyalty, activity, movement, whereabouts, affiliations, associations, transactions, acts, reputation, or character of any person;
- (C) the location, disposition, or recovery of lost or stolen property;
- (D) the cause or responsibility for fires, libels, losses, accidents, damage, or injury to persons or property;
- (E) securing evidence in the course of the private detective business to be used before a court, board, officer, or investigating committee;
- (F) protection of individuals from serious bodily harm or death.

Any of these activities, done as a business, requires a private detective license.

The FCRA exemption. O.C.G.A. § 43-38-14(a)(2) exempts "a person engaged in the business of furnishing information in connection with credit or marketing and a person or firm engaged as a consumer reporting agency, as defined by the federal Fair Credit Reporting Act." This carves out two related categories: the credit/marketing information business and FCRA-defined consumer reporting agencies.

The FCRA frame. Under 15 U.S.C. § 1681a(f), a "consumer reporting agency" is any person that, for fees or on a cooperative non-profit basis, regularly engages in assembling or evaluating consumer credit information or other consumer information for the purpose of furnishing consumer reports to third parties using interstate commerce facilities. A "consumer report" under 15 U.S.C. § 1681a(d)(1) is information by a CRA bearing on a consumer's credit worthiness, credit standing, credit capacity, character, general reputation, personal characteristics, or mode of living, used or expected to be used (in whole or in part) for: (a) credit or insurance for personal/family/household purposes; (b) employment purposes; (c) any other purpose authorized under § 1681b.

Permissible purposes under § 1681b. A consumer report may be furnished only for specific authorized purposes:
- (A) credit transactions involving the consumer;
- (B) employment purposes;
- (C) insurance underwriting involving the consumer;
- (D) government licensing or other benefits requiring financial responsibility evaluation;
- (E) investor or servicer in connection with valuation or credit risk assessment of an existing credit obligation;
- (F) any other legitimate business need in connection with a consumer-initiated business transaction or to review an existing account.

The exemption's scope. A CRA or credit reporting business is exempt from Georgia's private-detective-license requirement only for the activities that fit within the FCRA framework. The Board cannot require licensure for activities that fall under FCRA. But for activities that fall outside FCRA, and within the broader private-detective-business definition, the exemption does not apply.

Application. If a CRA does ordinary credit reporting for a credit application, no license required. If the same CRA also does skip tracing for debt collection where the purpose isn't FCRA-authorized (say, locating a non-debtor party for an unrelated investigation), or does background investigation for a private party that isn't an FCRA-permissible purpose, those activities require a Georgia private detective license. Whether the Board has authority in any specific case depends on the details of the activity and circumstances.

The footnote. Footnote 1 noted ambiguity about whether § 43-38-14(a)(2) creates one combined exemption (CRAs that handle credit/marketing information) or two separate exemptions (one for credit/marketing-information businesses generally and a separate one for FCRA-defined CRAs). The opinion didn't resolve this, but the answer matters because the credit/marketing exemption arguably reaches activities beyond FCRA's scope.

Currency note

This opinion was issued in 2007. Subsequent statutory amendments, court decisions, or later AG opinions may have changed the analysis. Treat this page as historical context, not current legal advice. Verify current law before relying on any specific rule, deadline, or remedy mentioned here.

The federal Fair Credit Reporting Act has been amended multiple times since 2007 (most prominently by the 2003 FACT Act and subsequent CFPB rulemakings), and Georgia's private detective licensing statute has been amended as well. Anyone considering Georgia licensure for a CRA or credit reporting business should consult the current Code, current FCRA, and any subsequent AG or Board guidance.

Common questions

Q: What's the practical effect of this opinion?
A: A consumer reporting agency that wants to expand into background-investigation services for private clients (employers doing pre-employment screening that goes beyond consumer-report categories, or individuals doing relationship investigations, etc.) needs to evaluate whether each service line falls within FCRA-authorized purposes. If not, the Board can require a private detective license for that service line.

Q: What's "skip tracing"?
A: Locating someone who has moved or is otherwise hard to find, typically a debtor, a witness, or a missing person. Some skip tracing falls within FCRA's permissible purposes (collecting on an existing account under § 1681b(3)(F)). Other skip tracing, locating a non-debtor third party, for instance: does not.

Q: How does the Board enforce this?
A: The Board can investigate complaints and take administrative action against unlicensed practice of the private detective business. Enforcement typically depends on someone (often a competitor) filing a complaint. Civil and criminal sanctions may apply for unlicensed practice.

Q: Could a single CRA need both an FCRA-exemption shield and a private detective license?
A: Yes. A CRA could be exempt from licensure for its FCRA activities and licensed for its non-FCRA activities. The two regulatory layers are not mutually exclusive.

Q: What about employment background screening?
A: Most pre-employment background screening falls under FCRA (§ 1681b(3)(B): employment purposes) and is therefore covered by the exemption. But certain investigations that go beyond what FCRA contemplates (deeper background investigations for security-sensitive positions, surveillance, etc.) may fall outside FCRA's scope and into the private-detective-business definition.

Q: How specific does the FCRA-purpose justification need to be?
A: The opinion didn't address procedural details, but as a practical matter, a CRA claiming the exemption needs to be able to identify the specific FCRA-permissible purpose for each report it furnishes. Documentation of the requesting party's certification of permissible purpose is a standard FCRA compliance practice.

Background and statutory framework

Georgia regulates private investigators and security agencies through the Board of Private Detective and Security Agencies, codified at O.C.G.A. Title 43 Chapter 38. The Board licenses individual private investigators, security guards, and businesses operating in those fields. The licensing requirement applies broadly to anyone engaged in the "private detective business," which is defined at § 43-38-3(3) using six broad categories.

The private detective definition is intentionally broad to capture various forms of investigation-for-hire that historically had blurry edges. The FCRA exemption in § 43-38-14(a)(2) acknowledges that there's a distinct industry, consumer reporting: that's federally regulated under FCRA and shouldn't also be subject to state private-detective licensure for the same activities.

The line between "FCRA activity" and "private detective activity" is not always crisp. A consumer reporting agency that does only ordinary credit reports clearly falls on the FCRA side. A private investigator that does only divorce surveillance clearly falls on the private detective side. In between is a wide range of investigative activity (skip tracing, asset searches, deep background investigations, locate-and-contact services) that might fit either category depending on the purpose, the requester, and the FCRA permissible-purpose framework.

The 2007 opinion clarifies that the FCRA exemption is purpose-specific, not entity-specific. A given company can be a CRA for some activities and a private detective business for others, and may need different regulatory compliance for each. The opinion was responsive to a real industry confusion: many CRAs assumed their FCRA status exempted them entirely from state private-detective licensure. The AG made clear the exemption is narrower.

The footnote ambiguity about whether § 43-38-14(a)(2) creates one or two exemptions is doctrinally interesting. The first reading (one combined exemption) would limit the exemption to FCRA-defined activities only. The second reading (two exemptions: credit/marketing information generally + FCRA-defined consumer reporting) would extend the exemption to credit/marketing information work that doesn't strictly fit FCRA. The opinion declined to resolve the ambiguity, leaving the question for case-by-case determination by the Board.

Citations and references

Statutes:
- O.C.G.A. § 43-38-3(3) (private detective business definition)
- O.C.G.A. § 43-38-14(a)(2) (FCRA exemption)
- O.C.G.A. § 43-38-16 (licensure requirement)
- 15 U.S.C. § 1681a(d)(1) (FCRA consumer report definition)
- 15 U.S.C. § 1681a(f) (FCRA consumer reporting agency definition)
- 15 U.S.C. § 1681b (FCRA permissible purposes)

Source

• Landing page: https://law.georgia.gov/opinions/2007-2
• Original PDF: not linked from landing page

Original opinion text

Your predecessor in office asked whether a consumer reporting agency or a credit reporting business that is providing services that fall within the definition of private detective business but not within the purview of the Fair Credit Reporting Act (hereinafter "the FCRA") must be licensed as a private detective agency by the Georgia Board of Private Detective and Security Agencies (hereinafter "the Board"). "Private detective business" is defined in O.C.G.A. § 43-38-3(3) as the business of obtaining or furnishing, or accepting employment to obtain or to furnish, information with reference to: (A) Crimes or wrongs done or threatened against the United States of America or any state or territory thereof; (B) The background, identity, habits, conduct, business, employment, occupation, assets, honesty, integrity, credibility, knowledge, trustworthiness, efficiency, loyalty, activity, movement, whereabouts, affiliations, associations, transactions, acts, reputation, or character of any person; (C) The location, disposition, or recovery of lost or stolen property; (D) The cause or responsibility for fires, libels, losses, accidents, damage, or injury to persons or property; (E) The securing of evidence in the course of the private detective business to be used before any court, board, officer, or investigating committee; or (F) The protection of individuals from serious bodily harm or death. A person engaged in any of these activities is engaged in the "private detective business" and must be licensed. O.C.G.A. § 43-38-16. However, insofar as the FCRA is concerned, there is an exception in O.C.G.A. § 43-38-14(a)(2) for "a person engaged in the business of furnishing information in connection with credit or marketing and a person or firm engaged as a consumer reporting agency, as defined by the federal Fair Credit Reporting Act." (Emphasis added.) Consequently, a person engaged in the "business of furnishing information in connection with credit or marketing" or a person or firm engaged as a "consumer reporting agency as defined by the federal Fair Credit Reporting Act" is not required to be licensed to engage in these activities under the Act.1 This is not to say that such a person or entity is not required to acquire a private detective agency license if engaged in other businesses unrelated to those referenced in the exemption above; rather, the extent of the exemption under O.C.G.A. § 43-38-14(a)(2) requires an analysis of the FCRA. Under the FCRA, a "consumer reporting agency" is "any person which, for monetary fees, dues, or on a cooperative nonprofit basis, regularly engages in whole or in part in the practice of assembling or evaluating consumer credit information or other information on consumers for the purpose of furnishing consumer reports to third parties, and which uses any means or facility of interstate commerce for the purpose of preparing or furnishing consumer reports." 15 U.S.C. § 1681a(f). In turn, a "consumer report" is "any written, oral, or other communication of any information by a consumer reporting agency bearing on a consumer's credit worthiness, credit standing, credit capacity, character, general reputation, personal characteristics, or mode of living which is used or expected to be used or collected in whole or in part for the purpose of serving as a factor in establishing the consumer's eligibility for (a) credit or insurance to be used for personal, family or household purposes; (b) employment purposes; (c) any other purposes authorized under section 1681b of this title. 15 U.S.C. § 1681a(d)(1). The authorized purposes for which a consumer report may be furnished under Section 1681b must relate to the following circumstances and no other, and must be to provide a consumer report to a person which it has reason to believe (A) intends to use the information in connection with credit transaction involving the consumer on whom the information is to be furnished and involving the extension of credit to, or review or collection of an account of, the consumer; or (B) intends to use the information for employment purposes; or (C) intends to use the information in connection with the underwriting of insurance involving the consumer; or (D) intends to use the information in connection with the determination of the consumer's eligibility for a license or other benefit granted by a governmental instrumentality required by law to consider an applicant's financial responsibility or status; or (E) intends to use the information, as a potential investor or servicer, or current issuer, in connection with a valuation of, or an assessment of the credit or prepayment risks associated with, an existing credit obligation; or (F) otherwise has a legitimate business need for the information (i) in connection with a business transaction that was initiated by the consumer, or (ii) to review an account to determine whether the consumer continues to meet the terms of the account. 15 U.S.C. § 1681b(3). In light of the foregoing, the Board does not have the authority to require licensure for credit reporting businesses and consumer reporting agencies whose activities fall under the scope of the Fair Credit Report Act as described above. Ordinarily, consumer reporting agencies may be expected to deal with matters relating to credit transactions, employment, insurance, and financial matters relating to licensure. However, it is possible that certain entities that act as credit reporting businesses or consumer reporting agencies may provide services that fall outside the scope of activities covered by the FCRA and within the list of activities referenced in the definition of "private detective business" in O.C.G.A. § 43-38-3(3). In those instances, the Board has the authority to regulate the collection and transfer of consumer information that is not provided in connection with such things as extending credit, providing insurance, or for employment purposes. Therefore, it is my official opinion that a consumer reporting agency or a credit reporting business that is exempt from licensure requirements as a private detective business under O.C.G.A. § 43-38-14(a)(2) nevertheless must obtain a license from the Georgia Board of Private Detective and Security Agencies to perform private detective business activities as defined in O.C.G.A. § 43-38-3(3) that do not fall within the scope of this exemption or any other exemption. Whether the Board has authority in any specific case will depend upon a thorough consideration all of the details of the activity and circumstances sought to be regulated. Prepared by: AJAY GOHIL Assistant Attorney General 1 Though it is not clear, O.C.G.A. § 43 38 14(a)(2) may create two exemptions, one for a person engaged in the business of furnishing information in connection with credit or marketing, and a separate exemption for a person or firm engaged as a consumer reporting agency as defined by the federal Fair Credit Reporting Act.