Veda accused of another breach of the Credit Reporting Privacy Code

John Kavanagh

Two months after complaining to the Privacy Commissioner that Veda had breached the Credit Reporting Privacy Code by not giving consumers easy access to free credit reporting information, a group of consumer advocates has lodged another complaint, claiming that Veda's paid credit reports are overpriced and incomplete.

The complaint, made jointly by the Financial Rights Legal Centre, Consumer Action Law Centre, Financial Counselling Australia and the Australian Privacy Foundation, says the A$79.95 price of a report, is "excessive and unreasonable."

The complaint also says an individual's VedaScore (which is separate from a credit report) should be included with a free credit report.

Earlier this year the New Zealand Privacy Commissioner ruled that the NZ$51.95 charge for a Veda Advantage credit report in New Zealand was excessive. The NZ Privacy Commissioner determined that only the actual cost should be charged.

The cost of a Dun & Bradstreet credit report in Australia is $30.

The Credit Reporting Privacy Code says that a credit reporting agency cannot charge for credit reporting information if the individual has not made a request for access within the preceding 12 months.

If a request has been made within the preceding 12 months, the agency may impose a charge, "but this must not be excessive".

The complaint to the Privacy Commissioner said that when Veda received requests for paid reports it was not checking when a credit report was last obtained.

"Many consumers would not be aware of their right to a free credit report and would simply click the "buy now" option [on the website]," the complaint said.

The consumer groups have called for the Privacy Commissioner to order an audit and for a refund to be paid to any individual who had paid for a credit report when they had not accessed a report in the previous 12 months.

On the issue of VedaScores, the complainants pointed to a section in the Credit Reporting Privacy Code that says "a CRB [credit reporting bureau] must provide the access seeker with access to all credit information in relation to the individual currently held in the databases that the CRB utilises for the purposes of making permitted disclosures, and all the CRB-derived information about the individual that is available."

VedaScores are proprietary ratings and are created using credit reports and other data to give consumers a rating between zero and 1200, with a high score indicating greater creditworthiness. Veda offers VedaScores as a subscription service.

The complainants' reading of the Code is that it "clearly requires the derived information (the VedaScore) to be disclosed in the free credit report."

Veda responded in a statement yesterday, saying it was reviewing the complaint.

It said: "Veda takes its regulatory and compliance obligations very seriously. In the past 12 months Veda has provided 110,000 free files to consumers."

In August, the same consumer groups complained that Veda had breached the Credit Reporting Privacy Code by not giving consumers easy access to free credit reporting information. They said access to a free credit report on Veda's websites was not as readily available, nor as easy to identify, as a paid credit report.

According to the complaints, Veda's website promoted the paid service at the top of the home page, whereas information about a free credit file could only be seen by scrolling down.

In addition, consumers could order a paid copy of their report over the phone but not a free copy. And the identification requirements to obtain a free credit report were more onerous than those required for a paid copy.

In correspondence released yesterday, the consumer groups said Veda had taken steps to resolve these matters but problems remained, including inconsistencies in the application process and intrusive marketing.