Directory error on sign up


I am getting the following error on sign up with Directory (latest version), if a user does not complete all fields required in step 3.

Catchable fatal error: Object of class WP_Error could not be converted to string in /home/radlett/public_html/email/wp-includes/capabilities.php on line 497

I have also noticed these fields can be filled with garbage and the checkout process still continues. Even if the checkout process fails or a user then cancels before proceeding, a user account is still created. Is there any way to avoid this?

Please help, Due to go live in 2 days.