Investigation and resolution of credit reporting complaints

59.158 Concerns about the existing regulation of credit reporting have focused as much on how the complaints and enforcement provisions have operated in practice as on the substantive obligations. More effective complaint handling and enforcement is seen by many stakeholders as central to making a significant improvement to the existing regulatory framework. Lack of access to effective complaint-handling mechanisms can have serious consequences for individuals who may have no access to credit while, for example, a disputed default listing remains part of their credit reporting information.

59.159 Stakeholders continued to express concern about the role of the OPC in handling credit reporting complaints. The Cyberspace Law and Policy Centre, for example, stated that the efficacy of the ALRC’s reforms will depend, in part, on improvements in the complaint-handling policies and procedures of the OPC.[185]

59.160 In Galexia’s view, problems stem from the fact that consumer caseworkers have lost confidence in the OPC as regulator and complaint-handling body for credit reporting.

Overall, we believe there is a real risk that in three to five years time consumers will still be unhappy with the complaints process unless there is a significant change in the approach of the OPC. The other ALRC proposals and enhancements are all worthwhile, but the OPC remains at the centre of credit reporting complaints management and simply must take a more flexible, proactive role and assist in removing technical and bureaucratic obstacles to effective dispute resolution.[186]

59.161 Galexia stated that consumer confidence in the OPC might be enhanced by: ensuring that systemic problems have consequences in terms of credit provider access to credit reporting information; allowing and encouraging the OPC to accept a complaint before it is referred to the respondent; and limiting the OPC’s discretion not to investigate a complaint.[187]

59.162 In this context, the reforms recommended in this chapter should be read in conjunction with those in Chapter 49, which deals with the investigation and resolution of privacy complaints generally. In Chapter 49, the ALRC makes a range of recommendations intended to streamline, and increase the transparency of, the resolution of privacy complaints, including in relation to credit reporting complaints. These recommendations are intended, among other things, to:

  • free up the Privacy Commissioner from dealing with individual complaints to enable more of a focus on systemic issues;

  • give the Commissioner more discretion not to investigate complaints, including where an EDR mechanism could handle the complaint;

  • clarify the Commissioner’s conciliation function in the Privacy Act and give complainants and respondents the power to compel a determination when conciliation has failed; and

  • give the Commissioner power to remedy systemic issues, for example, by requiring an organisation, such as a credit reporting agency, to undertake prescribed action for the purpose of ensuring compliance with the model UPPs.

[185]Cyberspace Law and Policy Centre UNSW, Submission PR 487, 19 December 2007.

[186]Galexia Pty Ltd, Submission PR 465, 13 December 2007.