11 April 2014

NZ Privacy Commissioner report on Veda

In New Zealand the Privacy Commissioner is underwhelmed by the practice of major consumer credit rating service Veda Advantage, the Australian-based business that is the successor to Baycorp Advantage, has attracted substantial criticism over many years and is currently facing criticism over free/charged access by consumers to their credit information. In 2012 Veda boasted that it had 15 million records with credit data on 16.5 million credit active individuals and 4.4 million businesses.

The Commissioner's Report by the Privacy Commissioner into Veda Advantage’s charge for urgent requests for personal information [PDF] last month states -
The Privacy Commissioner has conducted an own motion investigation into Veda Advantage’s charge for urgent requests by consumers for access to their own credit information.
The investigation has concluded that Veda’s current charge of $51.95 for urgent requests is unreasonable. Veda is not legally entitled to charge for some of the aspects of the process that make up its charges. The only aspect that can be charged for is the actual cost of making the information available to the individual – that is copying or formatting; and for delivering the information to the consumer.
The Commissioner’s view is that a reasonable charge would be nominal and that a flat rate at such a high level is unreasonable and therefore unlawful.
The Commissioner has sought undertakings from Veda:
  • that Veda will only charge for the actual cost of putting the requested information into a format ready for delivery and the actual cost of the delivery of information to the requester; and 
  • that Veda will cease charging for other aspects of processing urgent requests.
At the date of publishing this report, Veda had not provided the Commissioner with the assurances sought. Veda disagrees with our interpretation of what the law permits. The Commissioner is now considering what further action to take. That action could take the form of either amending the Credit Reporting Privacy Code, or referring the case to the Director of Human Rights Proceedings for him to consider whether to file proceedings against Veda in the Human Rights Review Tribunal or both.
The first step is to publish this report and findings in order to inform consumers about their rights. While these matters are resolved, consumers may wish to seek free access to their credit report on a regular basis to reduce the risk that they will be put in a position of having to make an urgent request.
This investigation has only been against Veda Advantage. We have not yet investigated other credit reporters’ practices. The Commissioner is considering whether to do so.
The report indicates -
An individual complaint was resolved, but we then undertook an own motion investigation.
We received a complaint that Veda Advantage Ltd  was charging too much for requests by people for a copy of their own credit information, when people wanted the credit information urgently.
The complainant refused to pay for an urgent report and instead received a free credit report, though not as early as he wanted or thought was reasonable. As he had not paid for an urgent report, he could not demonstrate that he had suffered any harm or loss as a result of Veda’s actions. In terms of the law there was therefore no interference with his privacy, and we closed the individual complaint.
However, this did not deal with our concerns that the standard charge for urgent requests was excessive. We therefore commenced an own motion investigation under section 69(2) of the Privacy Act. ... If people want access to their credit information urgently, they have no choice but to pay $51.95.
We note that people making urgent requests for their credit information may be doing so because they have a pressing issue regarding their credit, and accordingly are in a relatively vulnerable position. They may not have “twenty days to spare”.