Mar 24, 2014

Privacy con? Big Brother is now watching your credit card

They've been sold as 'enhancing' our privacy, but these changes are anything but. There's a new system for how personal credit files work and you could be the loser.

Cathy Alexander — Freelance journalist and PhD candidate in politics at the University of Melbourne

Cathy Alexander

Freelance journalist and PhD candidate in politics at the University of Melbourne

A government move to “enhance privacy protection” has been used as a Trojan horse to ensure much more of your personal financial information is available to big lenders. And the first some people will know of it is when they apply for credit and get stung with a higher interest rate.

The former Labor government accepted that Australians need greater privacy protections, and laws came into effect this month that were supposed to do just that. But Crikey has found the laws are not what they seem.

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6 thoughts on “Privacy con? Big Brother is now watching your credit card

  1. tonyfunnywalker

    THe Banks are at it as well. I am holding a letter informing me of the changes without the details on the article – and the solution – is a Bank product — Mortgage Insurance.
    The money making schemes are up and running.

  2. fractious

    Thanks Cathy for confirming what I’d suspected all along – the banks, the credit mobs and finance institutions (and their assorted hangers-on) will now have all the tools they need to screw us Jo Publics for all we’re worth and then some.

  3. AndyJ

    One of the other big issues is that most companies are essentially outsourcing credit decisions to Veda, eg. If credit score < 600 then reject the application.

    This happened to me recently when applying for a mobile phone with a different provider and I was declined. My credit report was perfect (and was obtained free) but I had to pay $60 to view my actual score (~550 out of 1200) which Veda helpfully explains mean I have a 10% chance of defaulting on any debt over the next 12 months. Veda offers no real recourse to appeal the score other than fixing mistakes on the credit file of which I had none.

    Credit checks with Veda also occur to applying for essential services such as electricty & gas, and when declined the applicant is referred to a "Lender of Last Resort" who usually charge a significant amount more than the cheapest retailer.

    Another way the system disadvantages those who can least afford it. Neither the FIO and TIO were overly helpful. There definitely needs to be some changes in consumer laws here, with the intention of actually protecting consumers.

  4. mikeb

    “Free” credit checks seem to be very difficult to extract. None of my family members have been able to find their credit history info via the free route. I suspect however that if you opt for the paid service your credit history will magically appear.

  5. Cathy Alexander

    Interesting mikeb. I have heard the same thing, and when I tried, somehow it was not possible.

    I’ll look into this some more. Can you tell me how many of your family members tried, which companies they tried, and what they were told when they did?

  6. mikeb

    @Cathy. 3 of us applied online with Dun & Bradstreet. In each case the report came back with “we do not have a Credit Report matching your search criteria”. The search criteria were correct however.

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