10 June 2003

"I am aware that many people are concerned about the processes used by Alliance Factoring when attempting to recover debts that the company bought, last year, from Telstra," said Federal Privacy Commissioner, Malcolm Crompton.

"From what we have seen, it appears that Alliance Factoring has sent out letters to people asking them to pay outstanding Telstra bills within two weeks or face having a default being listed on their credit file."

Under the Privacy Act, a credit provider can list an individual as not having paid a debt if the debt has been overdue for more than 60 days and the individual has been given written notice that they will be listed. In most cases, people are told when they first apply for a loan that they will be listed if they fail to make repayments.

"As the Telstra debts are more than 60 days overdue, Alliance Factoring can list people as having defaulted. In circumstances where a credit provider has purchased old debts, two weeks does not seem a reasonable enough time frame for people to attempt to verify whether or not they have an outstanding debt. While this is technically not a breach of the Act, it is not good privacy practice," said Mr Crompton.

"We are in contact with Alliance Factoring and looking at resolving this issue through further discussions with them."

Consumers concerned about their credit history should check their credit file (by contacting Baycorp Advantage or Dun & Bradstreet) and if there are any inaccuracies on the file they should write to the credit provider that listed them. If people aren't satisfied with the credit provider's response they should contact my Office on 1300 363 992 for advice or to lodge a complaint.

Further information:

• Credit Code of Conduct
• How do I get a copy of my credit report?
• When can a default be listed on my credit file?
• Why isn't an overdue payment removed from my credit file after I've paid the default?
• Why do I have a listing on my credit file when I only made an enquiry with a credit provider?