Case Citation: G v Credit Provider [2003] PrivCmrA 5

Subject Heading: Disputed default on consumer credit information file on the grounds that the amount listed was inaccurate

Law: Sections 18G(a) and 18E(8)(b) of the Privacy Act 1988 (Cth) and Determination 2003 No.2 Privacy Act 1988 (Cth), s.11B(1)(b)(v)(B) - concerning assignees

Facts:

In early 1999 the complainant owed $319 to the original credit provider. The complainant disputed the amount he had been charged and requested his account be amended. His account was not amended and the complainant did not pay the amount owed. In April 1999 his mobile phone service was disconnected, however the monthly service charges continued to accrue. At around the same time the Australian Competition and Consumer Commission (the "ACCC") charged the original credit provider for making false representations and ruled that the original credit provider credit its customers $50 and allow them to exit their contracts.

A payment default for $1,365 was listed on 3 July 2000 on the complainant's individual consumer credit information file. The debt was purchased by the respondent credit provider and it sent a Notice of Demand to the complainant in November 2002. The $1,365 listed incorporated the $319 owed and the accrual of the monthly service charges. The complainant paid the amount demanded in order to avoid threatened litigation and to be able to apply for a home loan successfully, but reserved his rights to complain to the Commissioner.

Issues:

The Commissioner's Determination 2003 No. 2 provides that when an organisation purchases a debt from a credit provider, it becomes the new credit provider. In this way, all rights and liabilities which attached to the original credit provider are assigned to the new credit provider.

Section 18G(a) of the Privacy Act requires that "a credit reporting agency in possession or control of a credit information file, or a credit provider or credit reporting agency in possession or control of a credit report, must take reasonable steps to ensure that personal information contained in the file or report is accurate, up-to-date, complete and not misleading". Information which the credit provider does not have reasonable grounds for believing is accurate is not to be provided to a credit reporting agency in accordance with section 18E(8)(b) of the Privacy Act.

Had the original credit provider adhered to the ACCC ruling, the complainant would have been able to exit the contract at the time and he would have only owed $269 ($319 - $50 to be credited) and not $1,365 listed as overdue on his individual consumer credit information file, which also included the accrual of the monthly service charges. Accordingly, the Commissioner found the credit provider in breach of sections 18G(a) and 18E(8)(b) of the Privacy Act.

Outcome:

As a result of the investigation, the credit provider reimbursed the complainant $1,096 (the difference between the amount paid ($1,365) and the amount owed ($269)) and also removed the default listed on his individual consumer credit information file.

The investigation was closed under s.41(2)(a) of the Privacy Act, on the grounds that the credit provider had adequately dealt with the matter.

OFFICE OF THE PRIVACY COMMISSIONER MAY 2003