4/07/2003

Federal Privacy Commissioner, Malcolm Crompton, announced today that following discussions between his Office and Alliance Factoring that the company has agreed to change its debt collection practices.

From now on, people who receive letters of demand from Alliance Factoring, requesting payment of an outstanding debt, will have at least 28 days to respond to the letter, rather than just the 14 days that was previously decided by the company.

"The extension of the response deadline is a good outcome for consumers and improves Alliance Factoring's debt collection practices," said Mr Crompton.

"While 14 days was not a long enough timeframe to allow people to verify the details of the old unpaid debts, 28 days sets a more reasonable minimum standard," he said.

"Alliance Factoring has also assured us that it will extend the period beyond 28 days where a person is waiting to receive extra information (such as invoices or bills) regarding the debt.

"During discussions with my Office, the company demonstrated a positive approach to working with us to implement good privacy practices.

"When my Office first examined the practices of Alliance Factoring, I said publicly that it was not good privacy practice to list people as being in default after only 14 days of receiving a letter of demand for payment. I also said, while listing within that time frame was technically not a breach of the Privacy Act that the Office would meet with the company to look at ways of resolving the issue," said Mr Crompton.

As a result of those meetings, the changes to debt collection practices that Alliance Factoring have agreed to, include:

• Changing its letters of demand, within the next two weeks, to give people a minimum of 28 days to contact the company.
• Giving people a further 14 days, from the time that people receive extra documentation from the company (such as old invoices or bills), before listing them.
• Being flexible about time lines when resolving the debt issue becomes complicated.

"I urge consumers, who have received letters from Alliance Factoring and who believe they have an outstanding issue to be investigated, to contact the company immediately to discuss matters relating to their account," said Mr Crompton.

"My Office will continue to monitor this situation and will investigate a number of remaining complaints regarding Alliance Factoring's debt collection practices. I urge people to contact my Office if they continue to experience problems in resolving allegations regarding old unpaid debts."

Further information:

• Privacy Hotline 1300 363 992
• 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?