MyCRA Specialist Credit Repair Lawyers

Tag: credit rating

  • 5 credit accidents you want to avoid this Christmas.

    Media Release

    credit accidents5 credit accidents you want to avoid this Christmas.

    17 December 2013

    Australians must put credit issues on their radar to ensure a bad credit rating is not the surprise they get this Christmas season, warns a consumer advocate for accurate credit reporting.

    Credit repair pioneer Graham Doessel, who is now Non-Legal Director of MyCRA Lawyers – a firm focusing on credit disputes, says too many Australians are kept in the dark about their credit file, but anyone who intends to borrow money in the next five years should make it their business to prevent simple accidents from hurting their credit rating.

    “I fear many people are unknowingly making mistakes with credit right now, which will see them locked out next year,” Mr Doessel says.

    Back in September, Credit reporting agency Veda Advantage published results of a survey showing that 80 per cent of Australians have never checked their credit history and 53 per cent were not aware that they could ask for a copy of their credit file.(1)

    Mr Doessel says these statistics are severely worrying and show too many consumers are unaware of how important their credit file can be for lenders making financial decisions.

    “There are no class lines, whether rich or poor if your credit file is ‘impaired’ by negative notations, your ability to obtain credit will be affected or the interest rate you are offered will be higher,” he says.

    “I would like to say it is always cut and dried – don’t pay, get bad credit but in reality it’s not that simple.”

    There are number of ways you can make mistakes and end up paying dearly for it. Over the Christmas period the risks can be higher.

    Mr Doessel covers the 5 major credit accidents at Christmas time:

     1. Accidental late payment.

    Right now, if you make a payment late on licenced credit (being loans, credit cards and other finance) – the information is being recorded. You may not intend to actually default on your loan – but Christmas can be a busy time where payments can get overlooked by a few days. Don’t let this happen to you. After March next year, late payment information will be available to lenders on your credit report and will stay there for 2 years. So don’t put off paying your credit card after Christmas pay on time every time to make sure your credit rating isn’t impacted.

    2. Accidental default.

    If you happen to unknowingly let any bill (including your phone bill or Energy account) slip into default – (more than 60 days overdue) a default listing will be recorded against your name. You may have the funds to pay, you may have simply overlooked the account – but your credit file will carry that default listing for 5 years – and most times you will be refused mainstream credit because of it. So if you plan to go away for Christmas, make a plan to ensure all of your bills are organised prior to leaving.

    3. Being careless with your personal information.

    Scammers are out in full force at Christmas, but often people are too busy to take care with their personal information. Credit cards are used more frequently and at a variety of locations; we’re being encouraged to sign up for free giveaways; we’re giving out more details online – but you must consider the risks to your credit rating. If fraudsters are able to access your personal details they have the key to your good credit rating. They can run up credit all over town. Often it’s not until victims apply for credit in their own right and are refused because of defaults that they realise their credit file has been misused.

    4. Not forwarding new information to old Creditors during moving and transfers.

    Christmas and New Year is a very common time for transfers and other work changes to occur that could see people moving interstate. A change of address is a very common reason bills go unnoticed – along with warning notices and the result is a bad credit rating that may not be detected until you actually apply for a home loan. Before you go, tie up all loose ends at your current address, ensuring all changes of address and accounts are settled and confirmed in writing to avoid being blacklisted for credit.

    5. Overlooking errors and omissions from Creditors.

    Even creditors are affected by the silly season -with staff busy and preoccupied. The volume of transactions may increase while staff decrease, putting stress on the Creditors’ systems. For this reason it is crucial for you to keep watch on your own finances. Check your bank statements and bills at this time. Keep abreast of which bills are due and when. If you don’t receive a bill, chase it up. Busy people make mistakes – don’t let them make it with your credit rating.

    You can check what is currently reported about you at www.freecreditrating.com.au.

    Mr Doessel says education is the key to ensuring less people are making mistakes with credit. More information on credit reporting in Australia can be found at the Office of the Information Commissioner’s website www.oaic.gov.au. MyCRA also provides up to date information on trends and issues in credit reporting impacting consumers www.mycra.com.au/blog.

    /ENDS.

    Please contact:

    Graham Doessel – Non-Legal Director MyCRA Lawyers Ph 3124 7133

    Lisa Brewster – Media Relations media@mycra.com.au

    www.mycra.com.au www.mycra.com.au/blog

    MyCRA Lawyers 246 Stafford Rd, STAFFORD Qld Ph 07 3124 7133

    MyCRA Lawyers is an Incorporated Legal Practice, focused on credit file consultancy and credit disputes. We mean business when it comes to helping those disadvantaged by credit rating mistakes.

    (1) http://www.veda.com.au/sites/default/files/images/ycai_launch_infographic_final_190913.pdf

    Image: Naypong/www.FreeDigitalPhotos.net

     

  • Help with credit card applications

    applying for credit cardRecently I was asked to participate on a panel of finance and credit experts, answering consumer questions on aspects of credit impacting credit card users. A common question “How long should I wait before applying for a new credit card?” was asked of our expert panel. If you wondered about this yourself, you should read this article, and have a look at what experts on the panel have to say which could help you and your credit rating.

    By Graham Doessel, Founder and CEO of MyCRA Lawyers.

    The article seen here below in full, is published on credit card comparison website www.creditcardoffers.com – a subsidiary of Credit World.

    Ask An Expert: How long should I wait before applying for a new credit card?

    Written by Kalianna and posted on December 2, 2013

     

    One of the most common questions we get at Credit Card Offers is whether or not it is too soon to apply for a new credit card or other credit product after taking up an offer. It’s a confusing situation for us as borrowers, with some lenders saying three months is long enough to wait, and others advising that two fresh applications within one year is the maximum we should be lodging if we want our credit files to stay in tact, including our expert Dominique Bergel-Grant, whose full answer to the question is below. Dun & Bradstreet’s Steve Brown tends to agree that too many applications will simply raise a red flag for lenders, and Dun & Bradstreet is one of the major credit reporting agencies operating here in Australia, which supplies information on consumers and businesses. The definition of ‘too many’ credit applications each year is open for some debate too, as according to State Custodians CEO Heidi Armstrong, up to four or five applications per year can be acceptable, depending on other factors.

    As another of our experts, Graham Doessel points out, some lenders may even decline your application automatically if you have made too many applications – and that won’t matter whether or not you actually took up offers of credit after those applications. If you find yourself in that situation, you may have an option to speak to lenders and/or credit reporting experts to rectify the situation.  ME Bank’s Nick Vamvakas does mention that when lenders have access to more information, they may give less weight to factors such as the number of previous applications if they can see other good reason to believe you are creditworthy. It’s bound to be harder where you have been rejected by a computer though.

    Doing balance transfers with credit card debt can also provide mixed signals – because lenders will see that you have simply moved debt onto another credit card, but at the same time they should also be able to tell that you are paying off that debt each month more easily with the extra information that will be available. That means that if  you’re using them correctly, balance transfers can be a useful tool for your debt and your credit file, and not damage your ability to borrow.

    The whole situation will be clarified further in 2014, when lenders gain access to a 24-month repayment history on borrowers’ credit files. We will start to see, over the course of the next year or two, what approach lenders take based on the new credit scoring system and the new information available. Until that time though, we can give you these words from those in the industry to take into account before applying for your next credit card or loan. Read each expert’s response and keep the information in mind when considering a new credit card or loan.

     In our second Ask An Expert panel question we have responses from four different experts. Each lays out the key considerations lenders take into account, and different variables that you should be aware of before applying for a new credit card or credit product;

    “How long should customers wait for applying for each new credit card? For example when transferring an existing balance from one card over to another to take advantage of 0% interest offers. What effect does this have on the customer’s credit score?”

     Graham Doessel

    Non-Legal Director,  MyCRA Lawyers

    Customers should definitely take precautions when applying for credit. The volume of credit people apply for and the type of credit can hinder any future credit application.

    In terms of how long customers should wait before applying for each new card – it really depends on each lender. However, we are aware that some Credit Providers will have an automatic decline with individuals who have applied for credit 3 times in the last 6 months, or show 6 credit applications in a 12 month period.

    In terms of credit applications impacting the credit score the general rule is:

    • Customers should only make a credit application they have full intention of pursuing.
    • Be wary of applying for ‘high interest’ or ‘bad credit’ loans –a credit ‘scoring’ method may shave points off your score through this type of credit application.
    • Seek cautious credit limits within your budget. Your credit score may be affected by credit limits which are considered too high.

     Nick Vamvakas

    Chief Risk Officer, ME Bank

    In the old credit reporting regime, which will be replaced in 2014, the number of credit applications was one of the few indicators available to credit providers to judge an applicant’s suitability to receive credit. It was a negative indicator and a larger number of credit applications in a short period could create a negative impression. While the number of credit applications may still be used as a negative indicator in the future, it will carry less weight as other indicators will now be available to credit providers. It is therefore likely to have a smaller negative impact on borrowers’ credit scores.

     Steve Brown

    Director, Consumer Risk Solutions at Dun and Bradstreet

    Each credit provider will have their own credit and risk scoring approach, however applying for multiple credit cards, loans or other finance in a relatively short period of time will show up on your credit report and be a potential red flag for lenders.

    Numerous applications in quick succession can indicate a high level of risk and an irresponsible appetite for credit, especially if you have unpaid debts to begin with.

     Heidi Armstrong

    CEO, State Custodians

    Each time a person applies for credit, it impacts their credit score. Around 4-5 credit applications per year is generally within the range of acceptable behaviour from the perspective of a main-stream lender. Therefore, if a customer is only applying for one or two credit cards per year (based around a 6 or 12 month balance transfer offer) then this is not necessarily seen in a poor light, provided the total number of credit enquiries during the year remain within the acceptable limits. Extreme care would have to be taken to only apply with one credit card provider and not put in multiple applications at the one time.

    A lender can see what different credit applications a customer has made and too many enquiries will create a ‘busy’ credit report and result in a poor credit score. If customers are continually rolling the same amount of credit card debt over to a new card, it means they are not actually paying the debt off and lenders will start to look upon this unfavourably. Continuously transferring credit cards is a short term solution and doesn’t fix the real problem of being in debt. If customers wish to take advantage of interest free offers, they should try to only consolidate once and then make an effort to pay off the debt as soon as possible.

     

    Dominique Bergel-Grant

    Founder, Leapfrog Financial

    As a rule you should not apply for more than two new credit facilities every 12 months.  When lenders see more than this they start to become concerned about your motives, and although it could be due to chasing a low rate it will still be a mark against you.

    Remember some lenders systems have automatic credit scoring, so if you fail due to multiple credit application then your application will simply be declined.  The biggest tip is to get a copy of your credit report and know exactly what the lenders will be finding out about you.  I recommend all my clients apply for a copy of their credit report once a year both to check for any errors, but also to ensure there has been no fraud.

     

    We hope the help offered here by these experts has helped you to know more about not only credit applications, but credit reporting in general. If you would like to know about Australia’s new Privacy Laws and how they might impact you, read our next post.

    FreeDigitalPhotos.net

  • Your home on the line: be vigilant with bills this Christmas.

    Media Release

    repayments ChristmasYour home on the line: be vigilant with bills this Christmas.

    28 November 2013

    Australian consumers need to be extremely careful with their repayments over the Christmas period as paying even ONE DAY late on some accounts could mean their credit rating is weakened, warns a consumer advocate for accurate credit reporting.

    Graham Doessel, Non-Legal Director of MyCRA Lawyers, a national firm which helps clients dispute their credit rating, says regardless of the size of the Christmas credit card bill – delaying payment on licensed credit could prove to be a long term credit disaster and reduce the chances of securing a home loan.

    “The majority of Australian consumers seem unaware that as of December last year if you default on making a licenced credit payment by the due date, it is noted, and from March 2014, this information will show as part of your credit history for two years,” he warns.

    This new data set of repayment history information (RHI) is part of amendments to the Privacy Act 1988 (Cth) and is intended to capture those individuals who are at risk with credit.

    Mr Doessel says it is unclear the weight lenders will give to RHI when assessing credit worthiness.

    “We don’t know precisely how many notations will be too many and mean credit refusal.  We also don’t know if having as little one late payment notation will move the individual to a higher ‘risk’ category with lenders, which will mean they are charged more in interest,” he says.

    March 2014 will see a new Credit Reporting Code of Conduct come into force, which will include a probable grace period of 5 days for late payments, but until the time frame is set – there is no room for mistakes.

    5 Tips For Saving Credit File Over Christmas

    1. Watch out for identity theft.
    Be aware fraudsters are out in full force at Christmas. Don’t be lax with personal information, and take care online to minimise the risk to your credit rating from misuse by identity thieves.

    2. Stay organised.
    With the busy lead up to Christmas, repayment of your accounts should still remain a priority. Develop a system so you don’t forget – or you will pay the price later. Try to pay at least a couple of days before the due date to allow for any systemic delays with banks or BPay.

    3. Pre-pay your bills before you go away.
    Don’t get caught out with a bill sitting at home unpaid while you’re away – pre-empt any bills which may come up during that time period.

    4. Spend within your budget.
    Whilst using credit at Christmas fosters the ‘pay later’ mentality – remember that you will pay at some point for what you spend now -so consider what you can really afford.

    5. Police your Credit Provider.
    Credit Providers can also be affected by Christmas. The volume of transactions may increase while staff decrease, putting pressure on systems.Check statements – make sure they are correct, and also keep abreast of which bills are due and when. If you notice you haven’t received a bill and you believe it’s due, you should chase it up.

    Christmas is also a good time for people to check their credit rating, to ensure the accuracy of their information.  They can request a copy of their credit file at no charge, from one or more of the credit reporting agencies and a credit report will be sent within 10 working days. Contact MyCRA Lawyers on 1300 667 218.

    About MyCRA Lawyers: MyCRA Lawyers is an Incorporated Legal Practice focused on credit file consultancy and credit disputes. MyCRA Lawyers means business when it comes to helping those disadvantaged by credit rating mistakes.

    /ENDS.

    Please contact:

    Graham Doessel – Non-Legal Director MyCRA Lawyers Ph 3124 7133

    Lisa Brewster – Media Relations  media@mycra.com.au

    www.mycra.com.au  www.mycra.com.au/blog

    MyCRA Lawyers 246 Stafford Rd, STAFFORD Qld Ph 07 3124 7133

    Links:
    http://www.oaic.gov.au/privacy/privacy-resources/privacy-fact-sheets/credit-and-finance/privacy-fact-sheet-16-credit-reporting-repayment-history-information
    http://www.austlii.edu.au/au/legis/cth/num_act/pappa2012466/sch2.html

    Image: “repayments Christmas” – Naypong/www.FreeDigitalPhotos.net

  • Online shoppers preyed on by fraudsters this Christmas

    Media Release

    christmas shopping onlineOnline shoppers preyed on by fraudsters this Christmas.

    26 November 2013

    More Australians will shop on the internet this Christmas, but a consumer advocate warns the increase in online trading could bring out more fraudsters looking to prey on time-poor and budget conscious consumers with schemes to not only take money, but personal information for purposes of identity theft.

    Graham Doessel, Non-Legal Director of MyCRA Lawyers, a firm which helps clients dispute their credit rating, says any unfamiliar retailer should be treated with caution, particularly those seeking personal information.

    “Consumers should be weary of those retailers seeking more personal information than would normally be necessary for a standard transaction, as we know that personal information can be stored and used to commit identity theft against unsuspecting consumers,” Mr Doessel says.

    “If fraudsters are able to get enough personal information they can request replacement copies of identification in your name and gain hold of your credit rating, so it may be your personal details that the crooks are really after.”

    He warns that unlike cases of bank fraud, where consumers may be reimbursed for stolen funds, an identity fraud case can be much more complicated and harder to recover from.

    “An identity theft victim may not always know the exact circumstances leading to debts in their name. In some cases they don’t even know they’ve been a victim until they apply for credit. There can be defaults and Judgments against their name which see them locked them out of credit for 5 years,” he says.

    According to the ACCC’s annual report on scam activity, online shopping scams have increased by 65 per cent since 2011. The ACCC cites the increase in online activity as the reason for the rise in scams.

    The Government’s Stay Smart Online website provides some online transaction safety advice:

    • Be wary if the website looks suspicious or unprofessional or makes unrealistic promises. Bargains which look too good to be true often are.
    • Only pay via a secure web page-one that has a valid digital certificate.
    • Use a secure payment method such as PayPal, BPay, or your credit card. Avoid money transfers and direct debit, as these can be open to abuse. Never send your bank or credit card details via email.
    • Always print and keep a copy of the transaction. Keep records of any emails to and from the seller.
    • Always conduct transactions within the auction website. Avoid private contact or payment directly with buyers or sellers-scammers will often use this ploy to ‘offer a better deal.

    Mr Doessel says if people worry they may have been caught out by identity theft this Christmas, they should act quickly to prevent credit file repercussions.

    “They should contact Police immediately, as well as their bank. They should also order a copy of their credit report – which would indicate if their credit file had been misused,” he says.

    In some cases victims may need the services of a credit reporting lawyer following identity theft to help with recovering their good name.

    About MyCRA Lawyers    : MyCRA Lawyers is an Incorporated Legal Practice focused on credit file consultancy and credit disputes. MyCRA Lawyers means business when it comes to helping those disadvantaged by credit rating mistakes.

    /ENDS.

    Please contact:

    Graham Doessel – Non-Legal Director MyCRA Lawyers Ph 3124 7133

    Lisa Brewster – Media Relations     media@mycra.com.au

    Ph 07 3124 7133     www.mycra.com.au  www.mycra.com.au/blog

    MyCRA Lawyers     246 Stafford Rd, STAFFORD Qld

    http://www.accc.gov.au/publications/targeting-scams-report-on-scam-activity/targeting-scams-report-of-the-accc-on-scam-activity-2012
    http://www.staysmartonline.gov.au/home_users/protect_yourself2/smart_online_shopping

    Image: sixninepixels/www.FreeDigitalPhotos.net

  • 1 in 12 Australian credit ratings threatened by identity theft.

    Media Release

    Identity theft1 in 12 Australian credit ratings threatened by identity theft.

    24 October 2013

    A survey conducted for the Attorney-General’s Department reveals Australian credit ratings are under increasing threat from ballooning identity theft numbers, and a consumer advocate for accurate credit reporting warns victims can pay heavily, with many locked out of mainstream credit for years.

    CEO of MyCRA Credit Rating Repair, Graham Doessel says when fraudsters take out credit in their victim’s name they can leave a trail of destruction on the victim’s credit file.

    “Fraudsters are never so kind as to pay the credit back. Defaults can then mount on the victim’s credit rating and hinder the victim’s ability to obtain credit in their own right,” Mr Doessel says.

    He goes on to say that “unless the victim can prove they didn’t initiate the credit in the first place, these defaults stay on the credit file for the term, which is five years.”

    The warnings come following the release of the ‘Identity Theft Concerns and Experiences‘ survey conducted by Di Marzio Research for the Attorney-General’s Department. (1)

    The survey found that identity theft had increased by a massive 40 per cent from 2011 to 2012 to almost one in four Australians having been a victim or known somebody who has been a victim of identity theft.

    It also showed 31 per cent of those victims had had their identity used to obtain finance, credit or a loan. This is an increase of 5 per cent from the previous survey in 2011.

    These figures correlate to almost one in every twelve Australians being victims of identity fraud which has had the potential to impact their credit rating.

    Mr Doessel says pieces of personal information are the building blocks for credit file misuse.

    “People can lose personal information in many ways, and they may be unaware of how or when it has occurred – particularly if it has happened via malware or even through too much sharing online,” he explains.

    “Sometimes it’s not until the victim applies for credit and is refused that they find out they have been exposed to identity fraud, and by then it may be too late to trace how it took place.”

    The survey pinpointed the private sector (Credit Providers such as banks and telcos) as providing victims with the most help with recovery, at 48 per cent – followed by Police at 32 per cent. Interestingly the government was cited as providing only 8 per cent of help with recovery, and 18 per cent of people had no help with recovery.

    But Mr Doessel warns that whilst Credit Providers may be able to help with reimbursing some identity theft victims, those that end up with defaults may not be so lucky.

    “It’s not a simple case of being ‘reimbursed’ for credit file misuse under the Credit Provider’s insurance. It is a slow and difficult process to try and recover a good name which has been tarnished,” he says.

    Mr Doessel says preventative measures centre around the safeguarding of personal information.

    “Get up to speed on the ways that fraudsters could misuse your personal information or your credit rating. Put as many preventative measures in place as possible, so that you have the least possible chance of becoming a victim.”

    “Also, check for credit file discrepancies. We recommend people regularly obtain a copy of their credit report to ensure that everything on their file is as it should be. That way if there are any problems, they can be rectified while there is no urgency,” he says.

    Under current legislation a credit file report can be obtained for free every 12 months from the major credit reporting agencies Veda Advantage, Dun and Bradstreet and TASCOL (if in Tasmania) and is sent to the owner of the credit file within 10 working days, or for a fee it can be sent urgently.

    Mr Doessel adds, Australia needs to create a culture of transparency when it comes to combatting this crime.

    “Talk, talk, and talk some more, about what you know about identity theft.  If you’re a victim – tell others about your story. In particular, talk to young people who might not fully understand the consequences of giving away their personal information and also talk to older people – who may be less tech-savvy and more vulnerable to predators,” he advises.

    You can find more information on identity theft on the Attorney General’s Website http://www.ag.gov.au/identitysecurity.

    /ENDS.

    Please contact:

    Graham Doessel – CEO Ph 3124 7133

    Lisa Brewster – Media Relations media@mycra.com.au

    Ph 07 3124 7133 www.mycra.com.au www.mycra.com.au/blog

    MyCRA Credit Repair 246 Stafford Rd, STAFFORD Qld

    MyCRA is Australia’s number one in credit rating repairs. We permanently remove defaults from credit files.

    (1) http://www.ag.gov.au/RightsAndProtections/IdentitySecurity/Documents/Identity%20Theft%20Data%20Survey%20Report%202012%20[PDF%205.3MB].pdf
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  • ‘Talk Like A Pirate Day’ For Childhood Cancer: Illness and Your Credit File

    MyCRA piratesAaargh me hearties! MyCRA be helpin’ to raise money and awareness of issues around childhood cancer support through ‘Talk Like A Pirate Day’. Talk Like A Pirate Day is dedicated to raising awareness of the impacts that childhood cancer has on families whilst raising vital funds for a great cause.

    We be raising some serious pieces of eight to help out with those families and we be doin’ it through speakin’ pirate all day today. We be havin’ a great time, an’ we hope you be likin’ our pirates Jamie and Zac in the picture.

    On a more serious note, we thought Talk Like A Pirate Day was a good opportunity to discuss the serious issue of how you can protect your credit file in times of illness in the family. We look at how your credit file can be affected by illness, and what you can do to protect it – because a financial crisis is the last thing you need.

    By Graham Doessel, Founder and CEO of MyCRA Credit Rating Repair and www.fixmybadcredit.com.au.

    Childhood Cancer Support provides a range of support services to families of children undergoing oncology treatment. These families are from various parts of Australia, Pacific Islands, Middle East and New Caledonia. When you or someone you love is fighting cancer or another serious illness, it can put a massive strain on your finances.

    According to Cancer Council research, families can expect to lose more than $47,200 when a family member is diagnosed with cancer, so the financial impact of a cancer diagnosis can leave many patients in desperate need of immediate funds.

    If you are unable to work – it is not always as simple as claiming sickness benefit – even if you have it – it’s not always straightforward. Many times in our line of work we have met people who have been unable to claim a sickness benefit or similar, until they have lost all of their assets. This is not a great situation to be in.

    The other thing that happens when someone you love is sick – is that all the day-to-day things go out the window. You are consumed by daily hospital visits, late nights and a blur of confusion and worry. Your head’s just not in the right place to focus on finances, and often repayments can get forgotten.

    Here are our top tips for protecting your credit file during a health crisis:

    1. Tell your Credit Providers.

    Now is not the time to be too proud to put your hand up for help. If you or a loved one is sick and it means you may be off work for some time, it is important to have a discussion with your Creditors if you know you will be unable to make repayments on time. Do this BEFORE you go into arrears, particularly for your licenced credit (mortgage, credit cards etc). If you make these repayments more than 5 days late, you will have it noted on your credit file, which stays there for two years. The other reason you should tell your Credit Provider, is you may even be eligible to claim a rebate or concession, or even receive a voucher or grant to assist with the cost of utility bills. Cancer Council Victoria has a factsheet on these – and you can check which you may be eligible for: http://www.cancervic.org.au/downloads/CISS_factsheets/prac-utilities.pdf. Check the Cancer Council in your State for more specific help.

    2. If the situation is dire, ask for a Financial Hardship Variation.

    New laws have been passed to help if you are experiencing mortgage stress, particularly in times of temporary hardship like illness. You may be able to reduce the size of your mortgage repayments, or even put a hold on repayments for a period of time without resorting to missed payments.

    Many people think they should not tell the bank they’re in financial trouble, and keep quiet for as long as they can about it. But it’s in the bank’s best interests to help you when you’re in trouble rather than see you default on your mortgage or have your home repossessed. One of the main differences between asking for and obtaining an official variation in your credit obligations compared with simply not paying your bills is that you avoid the bank placing a default listing on your credit file (provided you meet the new obligations that is).

    But there are some things you do need to be aware of. Any time you fail to make a repayment with your bank on time, the late payment will be recorded on your credit file – so for example if you are unable to make this month’s mortgage repayment by the due date – that late payment will be recorded on your credit file – including the date you repaid the overdue amount. It need only be five days late and you could be penalised.

    3. Set up systems to ensure your bills are paid on time.

    Although you probably don’t have much time, it’s a really good idea to try and set up direct debits with all of your bills as soon as you can – so you won’t be caught out missing a payment if you have even less time in the days and weeks ahead.

    4. Seek financial help and advice.

    The best place to start getting help with your finances is the Cancer Council in your state. Through the Cancer Councils, AMP offers free financial advice to cancer patients which could be invaluable in times of crisis.

    5. Check your credit file.

    Hopefully your family will one day soon recover from this unexpected crisis, and when that day arrives, make the time to check your credit file has stayed intact through it all. If there are any defaults, or other negative notations incurred during this time and you believe they are unfair, incorrect or just shouldn’t be there – you may have a case to dispute them and request their removal. Start by grabbing a copy of your credit file www.freecreditrating.com.au.

    It is a good idea to keep for anyone to keep their credit file as healthy as possible, but when you have a family health crisis, it is even more important that its clear in case you need to borrow funds.

    For more information and help with your credit file, contact MyCRA on 1300 667 218 or visit our website www.mycra.com.au.

  • Employee fraud: what could it cost your small business?

    Media Release

    employee fraudEmployee fraud: what could it cost your small business?

    2 September 2013

    When it comes to employee fraud, a national credit expert warns small businesses they are particularly vulnerable to “losing it all” if fraud strikes, and cannot afford to be complacent about checks and procedures regardless of business size.

    CEO of MyCRA Credit Rating Repair, Graham Doessel says SME’s can easily lose their good credit rating right under their noses if an employee chooses to pilfer funds.

    “Many SME’s run on credit, having a smaller amount of capital – and it can mean some months are a delicate balancing act to get accounts paid on time.”

    “Even a single instance of fraud can mean accounts go unpaid, posing a great risk to the business’ credit rating. In some cases it can also seep through to the owner’s personal credit rating which can also be tied up with the business,” Mr Doessel says.

    The Australian Financial Review reported last month that close to one in two Australian businesses reported at least one incident of economic crime in 2011, with 16 per cent of respondents suffering losses in excess of $5 million. (1)

    The AFR featured PricewaterhouseCoopers’ Global Economic Crime Survey, which has been undertaken every two years since 1999.

    The survey showed it’s rare that fraud is committed by someone outside an SME. In a small business, employees tend to be given control of cash, inventory and accounts receivable and there are few monitoring systems to check on them.

    “Operators of small and medium enterprises tend to believe, often incorrectly, that risk management to limit potential theft and fraud is too costly to implement. Other SMEs don’t have the resources to respond adequately to crime and can be heavily damaged, or even bankrupted, by a single incident,” it was reported.

    Mr Doessel says if the business owner is not made aware of the fraud right away it can lead to defaults on the business credit file or the owner’s credit file. The business can then face great difficulty obtaining any credit.

    “Most businesses can’t expand, they can’t buy vehicles, or even take out mobile phone plans once there are black marks on the company credit file,” Mr Doessel says.

    He goes on to say, that instances of fraud, as with any negative listing which shouldn’t be there, can be difficult for the individual or business to resolve.

    “The onus is on the credit file holder to prove the listing has errors or shouldn’t be there. Clients can often be given the run-around by Creditors, and there is less legal obligation on the Creditor in the commercial credit landscape,” he says.

    How To Prevent Fraud In Your Small Business     

    1. Reference Checks for Potential Employees

    ASIC Spokesperson Joanna Bird recently told Australian Broker that in a review of industry practice they found there weren’t enough businesses conducting thorough reference checks as part of pre-employment screening.

    “Nearly everybody did a police check, but in fact not everybody did reference checking,” she said. (2)

    2. Credit Checks for Potential Employees

    A Survey of Fraud, Bribery and Corruption in Australia and New Zealand published by KPMG earlier this year showed one of the top motivators for fraud was personal finance pressure. (3)

    Mr Doessel says employers should consider doing a credit check on potential employees.

    “A credit file check where appropriate, would certainly alert the employer to any major debts which could possibly provoke an employee to undertake fraudulent activity,” he says.

    Accountancy and Advisory firm William Buck also recently gave some insight into fraud prevention. Here are some ideas Director Grant Martinella offered to prevent fraud:

    3. Check financial statements for any adjustments.

    “Look out for any unauthorised accounting adjustments to financial statements and consider using software to report on any source data changes and discrepancies,” Mr Martinella told Business Insider Australia. (4)

    4. Be wary of key people who refuse to take annual leave.

    “Fraudsters may be reluctant to go on leave to avoid having someone else take over their responsibilities and look over their work while they’re gone.”

    “Enforce compulsory annual leave, segregate duties so people aren’t acting alone, and ensure that there are clear reporting channels,” Martinella says.

    SME’s who need assistance with their business credit rating following fraud can contact MyCRA tollfree on 1300 667 218 or visit their website, www.mycra.com.au.

    /ENDS.

    For media enquiries, please contact:

    Lisa Brewster – Media Relations  Ph 3124 7133     media@mycra.com.au

    Graham Doessel      – CEO Ph 3124 7133  

    http://www.mycra.com.au/  246 Stafford Road, STAFFORD QLD. Ph: 07 3124 7133

    MyCRA Credit Repair is Australia’s number one in credit rating repairs. We permanently remove defaults from credit files.

    (1) http://www.afr.com/p/sticky_fingered_employees_found_KPZjUqkaEcB8m8YhKHZatL

    (2)http://www.brokernews.com.au/news/breaking-news/employee-fraud-the-red-flags-you-need-to-identify-now-178606.aspx?utm_source=Australian+BrokerNews+eNewsletter&utm_campaign=bb8879c81a-ABNewsletter&utm_medium=email&utm_term=0_7af1e9f6de-bb8879c81a-43569498

    (3) http://www.kpmg.com/AU/en/IssuesAndInsights/ArticlesPublications/Fraud-Survey/Documents/fraud-bribery-corruption-survey-2012v2.pdf

    (4) http://www.businessinsider.com.au/five-signs-that-you-might-be-working-with-a-fraudster-2013-8

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    Image: Stock Photo/ www.FreeDigitalPhotos.net

  • Children targeted for clean credit history

    children credit historyAn interesting story just out of the United States on ID theft attempts on the credit files of children. Whilst Australia has vastly different laws when it comes to children and credit history, we want to share this story with you, to show that children are targets for fraudsters – and to explain what the dangers may be for our Australian children when it comes to fraudsters and their credit file.

    By Graham Doessel, Founder and CEO of MyCRA Credit Rating Repair and www.fixmybadcredit.com.au.

    An alarming report by ABC 2 WBay last week ‘ID Thieves Targeting Children’s Clean Credit History’, revealed that children and adolescents have become the fastest growing sector of identity theft victims in the United States. In the U.S., children are allocated a Social Security number from birth, and it is this number that fraudsters are using to steal the identities of their young victims, and take credit out in their name. Here is an excerpt from that story:

    Experts warn from the time your child gets a Social Security number, their personal information needs to be protected.

    “Be aware of how your children’s personal information is used just like your own information–Social Security number, and date of birth–be aware of how it is being used,” says Jim Walsh, U.S. Postal Inspector.

    In a recent case, more than 500 elementary school kids in Los Angeles had their information compromised.  A suspect with access to school files sold the kids’ personal information to another suspect.

    “There were hundreds of accounts opened and most of the accounts were used to get money,” said Walsh.

    The suspects withdrew cash advances, or they would sell the names to make fake IDs.

    Postal inspectors say children have clean credit histories, which makes them appealing to criminals.

    “If they apply for a loan or try to get credit, they could find out their credit is basically ruined and wouldn’t know it the whole time they are growing up,” said Walsh.

    That’s why it’s important to periodically check your child’s credit.

    Unlike the U.S. system, Australian children don’t have a social security number, so they are protected from any immediate identity theft. But what Australian Police have been concerned about in the past is that children are still targets for fraudsters due to their clean credit history, but instead of using personal information straight away as in cases in the U.S. it may be being stored or ‘warehoused’ until the child turns 18.

    The main area Police have been concerned about is Facebook – which remains incredibly popular with children, and gives them the option to openly share their personal information on the internet.

    The Australian Federal Police’s national co-ordinator of identity security strike team, Ben McQuillan spoke about the dangers of identity crime as far back as 2011 at a forum in Sydney on money laundering and terrorism.

    He warned listeners about what was then a new trend of ‘warehousing’ which involves storing data for a time, making it harder for a victim or bank to trace where and when the data was stolen.

    ”If people know your full name, your date of birth, where you went to school and other lifestyle issues, and they were to warehouse that data, there is a prospect that could then be used to take out loans or credit cards or to create a bank account that could then be used to launder money,” Mr McQuillan told the Sydney Morning Herald.

    This warning was echoed by Queensland Fraud Squad’s Superintendant Brian Hay, who warned that criminals were targeting the personal information of our young Facebook users.

    Supt Hay said criminals had been known to be storing the personal information of children around the world in databases to be used when they turn 18 and are able to take out credit.

    “We know that the crooks have been data warehousing identity information, we know that they’ve been building search engines to profile and build identities,” he told Channel 7’s Sunrise program in October 2011.

    “We need to tell our children if you surrender your soul, if you surrender your identity to the internet it could come back to bite you in a very savage way years down the track,” he said.

    This data warehousing could leave the newly credit active young person blacklisted from credit well into their 20’s. For 5 years they are locked out of credit, refused cards, loans, even mobile phones. It need not be major fraud to be a massive blow to the identity theft victim. Unpaid accounts for as little as $100 can have the same negative impact on someone’s ability to obtain credit as a missed mortgage payment. So any misuse of someone’s credit file can be extremely significant.

    Proving the case of identity theft when attempting to recover a clear credit rating is already difficult for the individual to undertake, as the onus is on the victim to prove to creditors they didn’t initiate the credit. Adding to that the fact that the perpetrator would be long gone with the actual act of identity theft happening years earlier – and those young people will have a very difficult task of recovery indeed.

    So how can we protect our children? In the same way we may protect our own identity and credit file.

    It begins with taking an active role in children’s computer use, and realising that their personal information is just as coveted as our own. Perhaps even more so – as the likelihood the child will have a clean credit history to begin with is even higher.

    Image: imagerymajestic/ www.FreeDigitalPhotos.net children credit history

  • Have Bad Credit? A bad credit loan is not your only option.

    bad creditFor someone who is locked out of mainstream credit because of their credit rating, their finance options become limited. But there are options, and in Australia, it may not always be entering into a “bad credit” loan. There are alternatives, depending on whether the credit file holder has grounds to dispute the bad credit tarnishing their credit file. We examine the ins and outs of bad credit loans in Australia, and the instances where it may be both fairer and cheaper to examine compliance with a credit repairer instead.

    By Graham Doessel, Founder and CEO of MyCRA Credit Rating Repair and www.fixmybadcredit.com.au.

    A bad credit report is a deal breaker with most mainstream Credit Providers. Bad credit can include defaults, writs, Judgments, Bankruptcies and even excess credit enquiries. From March 2014 it will also include payments more than 5 days late to licenced Credit Providers (loans, credit cards etc).

    [fusion_builder_container hundred_percent=”yes” overflow=”visible”][fusion_builder_row][fusion_builder_column type=”1_1″ background_position=”left top” background_color=”” border_size=”” border_color=”” border_style=”solid” spacing=”yes” background_image=”” background_repeat=”no-repeat” padding=”” margin_top=”0px” margin_bottom=”0px” class=”” id=”” animation_type=”” animation_speed=”0.3″ animation_direction=”left” hide_on_mobile=”no” center_content=”no” min_height=”none”]

    Graham Doessel
    Graham Doessel
    Founder & CEO
    MyCRA Credit Repairs &
    www.ADSLAW.com.au

    Bad credit impacts most people for between 5 and 7 years – and 2 years for repayment history. Most mainstream Credit Providers will refuse credit – particularly in the current economic climate. Often people can’t even get a mobile phone plan.

    Despite this, many alternative loans are available out there for people who are on the outer due to bad credit defaults and other credit listings. But these bad credit (non-conforming) loans generally come at a much higher interest rate, which can cost people tens of thousands more in interest just over the first three years of the loan.  This is in order to cover the risks associated with taking on someone with bad credit. For example, on a loan of say $300,000, the difference in 2% from the standard variable rate of say 7% to a bad credit loan rate of say 9% could mean a family is paying as much as $15,046.57 more over those first three years just in interest.

    Prior to branching out into credit repair, I ran a successful non-conforming brokerage helping people who were refused mainstream credit. But with many people – when I heard about the circumstances around their bad credit – I often felt they had been dealt an unfair blow – forced to pay thousands more in interest when the bad credit possibly shouldn’t have been there in the first place.

    This is why, the first port of call when someone is faced with bad credit, should be to determine the accuracy of the credit listing.

    Savingsguide.com.au published a great article on bad credit loans in Australia, titled A Guide To Loans For People With Bad Credit.

    It features some pertinent advice about choosing a loan after being refused credit with a mainstream lender. It goes through the steps you may need to take to secure finance in Australia, and includes some final tips for securing a loan. The central tip is, prior to committing to a loan attempt to fix your bad credit issues first.

    “Loans for people with bad credit should really be a last resort, as opposed to the only option. See what you can do to repair your credit rating beforehand and hopefully begin looking for loans just as anyone else would,” Savingsguide.com.au’s Alex Wilson says.

    Australians should not put up with bad credit if it shouldn’t be there. Any credit listings which the individuals believe are inconsistent, unfair, or incorrect should be disputed.  Credit rating errors could be anything from the credit listing placed by the Credit Provider on the wrong credit file; to the basis of the credit listing being unfounded; to incorrect notices being provided; right through to system errors and incorrect spelling, to name a few examples.

    Creditors are bound by a large volume of legislation and codes of conduct to do with placing information on consumer credit files. These laws are in place to protect consumers from unfair and damaging credit reporting.

    Credit repair is a lengthy process, involving the review of all documentation from an individual – including the credit file and all the circumstances surrounding the default, writ or Judgment.

    The credit repairer will conduct an audit-like investigation of the circumstances surrounding the credit listing, noting any compliance issues which would deem the credit listing unlawful and require its removal from the credit file. If the credit listing has been placed unlawfully, then it should be removed.

    When an inconsistent credit listing is removed, it generally means the consumer is able to apply for mainstream credit – provided bad credit was the only item preventing finance approval.

    If you would like an assessment for your suitability for credit repair, talk to a consultant at MyCRA Credit Rating Repair on 1300 667 218 – they can assess how you might fare in removing bad credit before you commit to any bad credit loan in Australia. Do bear in mind – there are some credit listings which MyCRA cannot remove from your credit file, including Bankruptcies.

    Image: Stuart Miles/ www.FreeDigitalPhotos.net

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  • Help to reduce your risk of identity theft

    Identity theft“Identity is one of our most valuable assets – if it is stolen, the stress and financial costs can last for years,” says Attorney-General Mark Dreyfus QC. According to the Attorney-General, identity theft is currently at 7% and rising (up from 5 per cent in the previous year)* – and so a new booklet has been formulated to give Australians practical advice on guarding their identity and what to do if they think it’s been stolen. We offer a link to this booklet and encourage all of our readers to download it, and even print it out and give it to someone you know who you think may be at risk. It just may save your bank accounts, your identity and your credit file from misuse.

    By Graham Doessel, Founder and CEO of MyCRA Credit Rating Repair, and www.fixmybadcredit.com.au.

    The booklet ‘Protecting Your Identity’ was launched by the Attorney-General last week. For anyone who is not so familiar with the workings of identity theft, it is a comprehensive document on the how’s and whys of identity theft. We found this page to be particularly relevant:

    Why Should I Be Concerned About Identity Theft?

    Once your identity has been stolen it can be almost impossible to recover. You may have problems for years to come. Some of the things that criminals may be able to do with your identity include:

    • tricking your bank or financial institution into giving them access to your money and other accounts

    • opening new accounts and accumulating large debts in your name which will ruin your credit rating and good name

    • taking control of your accounts including by changing the address on your credit card or other accounts so you don’t receive statements and don’t realise there is a problem

    • opening a phone, internet or other service account in your name

    • claiming government benefits in your name

    • lodging fraudulent claims for tax refunds in your name and preventing you from being able to lodge your legitimate return

    • using your name to plan or commit criminal activity, and

    • pretending to be you to embarrass or misrepresent you, such as through social media.

    Identity theft is the curse of the 21st Century and that is becoming more evident in our industry of credit rating repair. There are more and more people needing help with repairing their credit file due to having their identity misrepresented in some way.

    Often the first time we are aware of identity theft is when we apply for credit and are flatly refused due to defaults on our credit file that are not ours.

    Credit file defaults are difficult for the individual to remove and generally people are told by creditors they remain on our file for 5 years, regardless of how they got there.

    Although it seemed so easy for the fraudster to use your good name in the first place, you are now faced with proving the case of identity theft with copious amounts of documentary evidence.

    If you have neither the time nor the knowledge of our credit reporting system that you may need to fight your case yourself, you can seek the help of a credit repairer. A credit repairer can help you to clear your credit rating and restore the financial freedom you rightly deserve.

    The reason a credit repairer is usually so successful in removing your credit file defaults, is their relationships with creditors, and their knowledge of current legislation.

    If you have just found out you are a victim, we recommend you also contact the Police. Don’t be embarrassed – it is only through identity theft being reported that data gets collected and appropriate preventative measures eventually get put in place.

    Top Tips for Preventing Identity Theft

    In a statement to the media last week, Mr Dreyfus also outlined some simple steps Australians can take to reduce their risk of becoming a victim of identity theft:

    • Secure your mailbox with a lock and, when you move, redirect your mail.

    • Be cautious about using social media, and limit the amount of personal information you publish online.

    • Secure your computer and mobile phone with security software and strong passwords, and avoid using public computers for sensitive activities.

    • Secure your personal documents at home and when travelling.

    • Learn how to avoid common scams at www.scamwatch.gov.au.

    • Be cautious about requests for your personal information over the internet or phone and in person in case it is a scam.

    • Investigate the arrival of new credit cards you haven’t requested or bills for goods and services you have not purchased.

    • Be alert for any unusual bank transactions or missing mail.

    • If you are a victim of identity theft, report it to the police and any relevant organisations.

    • Order a free copy of your credit report from a credit reporting agency on a regular basis, particularly if your identity has been stolen.

    * Last year a survey commissioned by the Attorney‑General’s Department found 7 per cent of respondents had been victims of identity crime in the previous six months – up from 5 per cent the previous year.

    Image: Victor Habbick/ www.FreeDigitalPhotos.net

  • Access to credit will fall with introduction of new credit reporting data – and it’s being collected now

    Press Release

    default listingAccess to credit will fall with introduction of new credit reporting data – and it’s being collected now.

    27 June 2013

    Credit numbers are expected to decline when more data is reported about Australian credit habits in March next year, and a consumer advocate for accurate credit reporting warns, some simple mistakes may mean it is your credit worthiness on the line.

    CEO of MyCRA Credit Rating Repair, Graham Doessel says this is an important time to know about Australia’s credit laws, and to be careful with how you use and repay credit.

    “Australian consumers are currently under the microscope with their repayments, and if they are more than five days late with their repayments to licenced Credit Providers, that is going on their credit record now for two years and will show up as of March next year,” Mr Doessel advises.

    “In my opinion, this is going to trip up many Australians. With only a 5 day grace period proposed, it may mean many Australians are unnecessarily banned from credit due to simple billing mistakes, lost paperwork and other payment mishaps,” he says.

    The prediction of reduced credit numbers has been echoed by Dun & Bradstreet CEO, Steve Brown at a recent Australian Banking and Finance Conference.

    Publication Banking Day reported Mr Brown as telling the conference that a contraction in consumer credit will take place following the introduction of comprehensive reporting in March.

    “Lenders will start to learn things about consumers that they did not know before, such as the number of late payments they make,” Brown says.

    And so say Citigroup.

    “Citigroup Australia’s country risk director for consumer, CLN Murthy, agreed that there would be a tendency to reduce credit limits after comprehensive credit reporting came in,” Banking Day reports.

    Repayment information will be part of five new data sets to show up on your credit report as part of wide-sweeping amendments to Australia’s Privacy Act, which includes a new Credit Reporting Code of Conduct.

    “Prospective lenders will be privy to your repayment habits – and the word is out that more and more information may be on the table going forward,” Mr Doessel warns.

    Banking Day recently reported that Mr Brown and others in the consumer finance industry will be pushing for even more data to be included in the future.

    “Brown said Dun & Bradstreet would like to see the inclusion of account balance data in credit files,” Banking Day reports.

    The long term plans with respect to repayment history information is to be able to offset good repayment history against a default listing. The conference predicted that products and pricing structures could be developed for these borrowers.

    In the meantime, Mr Doessel says there are some simple things credit-active Australians can do to make sure their credit-worthiness remains in-tact:

    1. Pay on time, every time. Pay within five days of your bill’s due date to avoid a late payment notation. It doesn’t have to be a big amount to impact you. Too many late payment notations will probably mean you’re refused credit, or offered only a high interest rate.  

    2. If you can’t pay, actively seek help. There are new laws to help prevent you from being defaulted if you are under financial hardship, provided you get in early with your Credit Provider. So there is a new incentive to get in and work it out prior to letting your accounts go into arrears and copping a default listing.

    3. Seek cautions credit limits. If you’re not using it, don’t have it is the general adage. If you take out a credit card or other line of credit, it’s probably not wise to opt for a lofty limit, but ask for an amount closer to what you intend to use.

    4. Consider identity theft risks. Understand how lucrative your personal information is and take steps to keep abreast of how it can be at risk. New laws will allow you to place a ban period on your credit information if you believe you may be at risk of identity theft. Acting quickly may prevent credit file misuse.

    5. Check your credit file regularly. With the new information available, it will be more important than ever to check your credit file. Many people don’t know you can do this for free annually through the Australia’s credit reporting agencies and a copy is sent within 10 working days.

    6. Correct credit information which you believe is inaccurate, inconsistent or unfair. To offset the new information, new laws will make it fairer for those disadvantaged individuals to access and correct their credit report.

    But Mr Doessel says there will still be a requirement to work within and have knowledge of credit reporting law when disputing an inaccurate or unfair credit listing.

    “It is important to note, that Credit Providers and Ombudsman must act impartially and cannot advocate for you,” he warns.

    He says you can start by contacting your Credit Provider yourself to alter incorrect information, or you can put your case for dispute in the hands of an advocate.

    “You should take steps to rectify mistakes before the information has any bearing on a credit application you may make in the future,” Mr Doessel says.

    “You should take steps to rectify mistakes before the information has any bearing on a credit application you may make in the future,” Mr Doessel says.

    /ENDS.

    Please contact:

    Graham Doessel – CEO Ph 3124 7133

    Lisa Brewster – Media Relations media@mycra.com.au

    Ph 07 3124 7133 www.mycra.com.auwww.mycra.com.au/blog

    MyCRA Credit Repair 246 Stafford Rd, STAFFORD Qld

    MyCRA is Australia’s number one in credit rating repairs. We permanently remove defaults from credit files. CEO of MyCRA Graham Doessel is a frequent consumer spokesperson for credit reporting issues and is a founding member of the Credit Repair Industry Association of Australasia.

    Image: Victor Habbick/ www.FreeDigtalPhotos.net

     

     

  • Update on mandatory data breach notification laws

    mandatory data breach notificationThe long-awaited amendments to the Privacy Act 1988 making reporting of serious data breaches mandatory, has been passed in the House of Representatives and had its second reading in the Senate yesterday. We  cover what this Bill will mean if it is passed, and what it means for your credit file.

    By Graham Doessel, Founder and CEO of MyCRA Credit Rating Repair and www.fixmybadcredit.com.au.

    If passed by both houses, the Privacy Amendment (Privacy Alerts) Bill 2013 will be implemented as part of amendments to the Privacy Act in March next year, alongside other amendments.

    The amendments will force businesses and government agencies covered by the Privacy Act 1988, to notify people when a serious data breach affecting their privacy occurs.

    The notification requirements do not apply to all data breaches, only breaches that give rise to a risk of serious harm. Serious harm could include physical and psychological harm, as well as injury to feelings, humiliation, harm to reputation and financial or economic harm.

    The Commissioner will be able to seek civil penalties if there is serious or repeated non-compliance with the notification requirements and the Information Commissioner will be able to direct agencies and business to notify individuals of data breaches.

    The legislation has been introduced following criticism of the current voluntary reporting system. It seems when faced with a choice, many entities think of the bottom line or other publicity concerns rather than the security of people’s personal or financial information.

    A bit about how data breaches can threaten your credit file

    Personal information in the wrong hands can lead not only to identity fraud, but the misuse of the victim’s credit file, which can have significant long term consequences.

    A lot of identity fraud is committed by piecing together enough personal information from different sources in order for criminals to take out credit in the victim’s name. Often victims don’t know about it right away – and that’s where their credit file can be compromised.

    Once the victim’s credit rating is damaged due to defaults from this ‘stolen’ credit, they are facing some difficult times repairing their credit rating in order to get their life back on track.

    These victims often can’t even get a mobile phone in their name. It need not be large-scale fraud to be a massive blow to their financial future – defaults for as little as $100 will stop someone from getting a home loan.

    Once an unpaid account goes to default stage, the account may be listed by the creditor as a default on a person’s credit file. Under current legislation, defaults remain on the credit file for a 5 year period.

    What is not widely known is how difficult credit repair following can be – even if the individual has been the victim of identity theft, there is no guarantee the defaults can be removed from their credit file. The onus is on them to prove their case and provide copious amounts of documentary evidence.

    Unfortunately data breaches are difficult for individuals to have any control over, and the only way people can ensure their details are safe are to demand that the companies they deal with have strong IT systems before disclosing that information.  People should adopt the philosophy of a need-to-know basis for disclosing their personal information. They should always question the need for it to be handed over. If it is not essential, they shouldn’t do it.

    Image: Stuart Miles/ www.FreeDigitalPhotos.net

  • Banks encouraged to lift their standards around guarantor education.

    Guaranteed loans – they’ve become more prevalent as house prices rise, and as access to business credit changes – but this type of loan can come with significant risk depending on how it’s set up. guaranteed loanIt often requires a savvy, credit-educated person to sign on the dotted line to take on a guaranteed loan. But this isn’t always the type of person asked to sign a guarantee. In response to some complaints by guarantors who claim they have not been given the appropriate advice, a survey was issued to banks to review their compliance with the Code of Banking Practice by its review body, the Code Compliance Monitoring Committee. We examine the findings of this survey, and put guaranteed loans into perspective with the possible implications to the guarantor’s credit file.

    By Graham Doessel, Founder and CEO of MyCRA Credit Rating Repair and www.fixmybadcredit.com.au.

    Guaranteed loans can be complicated, and can leave some individuals vulnerable. The Code of Banking Practice has identified this, and has set out requirements for banks in dealing with the area of guaranteed loans (28.3-28.6 of the Code of Banking Practice) which include requiring banks to issue prospective guarantors a warning notice explaining their rights and obligations as a guarantor. Banks also can’t accept a guarantee until the guarantor has sought independent advice.

    But has this been enough to protect individuals who find themselves asked to guarantee a loan? The Code Compliance Monitoring Committee (CCMC) has found more can be done by banks to promote better compliance, and ultimately better understanding by individuals of the risks involved in guaranteeing a loan.

    The CCMC is an independent review body for banks’ compliance to the Code of Banking Practice. According to the CCMC report on guaranteed loans, the body undertook a survey of banks due to a number of allegations of breaches of the Code by banks:

    “During 2011-2012, the CCMC received a number of concerns and enquiries about alleged breaches of the Code by banks in this area,” the report states.

    The CCMC identified a need going forward to ensure compliance, and better compliance by banks to the Code concerning guaranteed loans. It considered the economic climate will likely continue to provide an environment where guaranteed loans will rise:

    “The high number of credit facilities currently supported by a Guarantee indicates that these play an important part in the provision of credit, both to individuals and to businesses. Issues can and do arise however when banks do not comply with their own procedures. While the number of cases where issues have arisen in respect of Guarantees is comparatively small, the impact on individuals in these circumstances can be considerable. The current economic environment also suggests that this may continue to be an important issue over the short to medium term. This is a view shared by the consumer advocates interviewed by the CCMC as part of this Inquiry.”

    The CCMC’s report demonstrates that overall banks were meeting the requirements of the Code by having good systems and procedures in place, and were monitoring those systems. But it also found that some banks could do more. It cited some good industry practices amongst some banks that could be applied across the board to ensure prospective guarantors were making informed decisions. The CCMC says it recognises that banks have an important role in ensuring relevant information if both provided and considered by prospective guarantors prior to the execution of the Guarantee:

    “The Code sets out the minimum standards banks have agreed to follow when dealing with personal and small business customers. Banks should, therefore, consider how they satisfy themselves that informed decision making is taking place, particularly where they identify that a prospective guarantor might be vulnerable, whether due to their relationship with the borrower or where they have limited capacity to understand the credit contact, such as where English is a second language. The CCMC also considers that the more complex the Guarantee and the loan documentation, the greater is the obligation on the bank to ensure the potential guarantor engages in informed decision making.

    The CCMC accepts, however, that there is a duty on the individual to consider carefully the information provided by banks before agreeing to become a guarantor,” it states.

    Disclosures of information and warnings were considered imperative to the guarantor making an informed decision about becoming a guarantor. The CCMC recommended banks ensure that information and notices are provided to the prospective guarantor in a timely manner to ensure they have sufficient time to consider their position and the risks associated with the Guarantee prior to execution.

    This will ensure that the prospective guarantor has sufficient time to consider the risks and financial liabilities of becoming a guarantor before entering into the agreement.

    Good industry practice suggests that even a prospective guarantor who has received independent advice, should be given at least 24 hours to consider the Guarantee documents prior to signing.

    This will increase the prospective guarantor’s opportunity to consider the risks and financial liabilities of becoming a guarantor in the context of the independent advice given, before entering into the agreement.

    They also brought up the need for banks to consider the vulnerability of a prospective guarantor:

    “Banks which have effective processes to identify classes of prospective guarantors and take additional steps to ensure they receive information about their rights and responsibilities and the financial position of the borrower, are better placed to comply with their Code obligations.”

    These vulnerable individuals may include elderly people, non-English speakers and people who offer a family home as collateral. The CCMC will follow up this Inquiry in the 2013/14 Annual Compliance Statement, to determine what changes, if any, banks have implemented to systems and procedures in response to the findings of the survey.

    Earlier in the year, we reported that some banks had begun to relax requirements around guaranteed loans to include a new term – Security Guarantee. This meant the guarantor would no longer have to be a parent, sibling or spouse of the borrower. But identified at the time, were some significant risks to this loan which arguably far outweigh the benefits.

    On a guaranteed loan the guarantor is liable for the debt if the borrower fails to make repayments. The guarantor’s credit rating is then linked with the credit rating of the borrower through the loan, despite having little control over the outcome of repayments.

    If the debtor defaults on their loan, under certain terms the Credit Provider can pursue the guarantor to recover the debt, which can include default listing the guarantor. Negative entries such as defaults on a person’s credit file will impact the ability to obtain credit for 5 years.

    In cases of significant arrears, the bank begins to use the property the guarantor put forward as collateral to recover the outstanding debts.

    It is timely that the CCMC should review banking procedures in this area. The upward trend in guaranteed loans may increase the exposure of vulnerable individuals to guaranteed loans in their many forms.

    It is imperative that all facilitators take on an educational role – despite it ultimately being the decision of the guarantor themselves. Further education at that level will help to identify more who are vulnerable, and protect those who may not be fully informed of their rights, their obligations and the risks to their finances and their credit file before entering a guaranteed loan.

    Image: Ambro/ www.FreeDigitalPhotos.net

  • Gamers: cheating could cost you your credit rating

    If you or someone in your family is a gamer, then you would be familiar with gamershacks. Hacks and cheats are designed to give a gamer help with a game by allowing them to download useable software for assistance. But security company, AVG says downloading hacks could open up a can of worms not only for the gamer, but for anyone else that uses the computer, because you have probably also just downloaded Malware. We look at how this occurs, what Malware does and what the risks are for your personal information and  your credit file.

    By Graham Doessel, Founder and CEO of MyCRA Credit Rating Repair and www.fixmybadcredit.com.au

    Antivirus vendor AVG has issued a warning to gamers following research which suggests that more than 90 per cent of ‘hacks’ available online contain some form of malware or malicious code.

    Hacks and cheats are commonly incorporated into games; however, the sheer popularity of online multiplayer games has made gamers prime targets for cybercriminals.

    “The research suggests more than 90 per cent of hacks, cracks, patches, cheats, key generators, trainers and other downloadable game tools contain malware or executable code.

    These hacks are commonly delivered via unregulated torrents and file sharing sites, an easy vector for malware.

    Malware inadvertently downloaded with hacks can give attackers easy access to your online gaming account as well as other sensitive information such as online banking details, personal data and passwords for other online services,” Stay Smart Online recently advised.

    They advise gamers to only download patches from the game’s official site, and to avoid any unofficial software. They also recommend:

    Always be suspicious of any files downloaded from torrents and file sharing websites.

    Ensure you always have up-to-date security software installed on your computer.

    Use unique account logon and password information for each of your online gaming accounts (and every other online service you use).

    What is ‘malware’?

    Malware— is short for ‘malicious software’. It is a type of malicious code or program that is used for monitoring and collecting your personal information (spyware) or disrupting or damaging your computer (viruses and worms). Stay Smart Online explains in more detail:

    Spyware

    The term spyware is typically used to refer to programs that collect various types of personal information or that interfere with control of your computer in other ways, such as installing additional software or redirecting web browser activity.

    Examples of spyware include:

    Keyloggers  

    A keylogger is a program that logs every keystroke you make and then sends that information, including things like passwords, bank account numbers, and credit card numbers, to whomever is spying on you.

    Trojans

    A Trojan may damage your system and it may also install a ‘backdoor’ through which to send your personal information to another computer.

    Viruses and worms

    Viruses and worms typically self-replicate and can hijack your system. These types of malware can then be used to send out spam or perform other malicious activities and you may not even know it.  Both can use up essential system resources, which may lead to your computer freezing or crashing.  Viruses and worms often use shared files and email address books to spread to other computers.

    malwareMalware and your credit file

    If fraudsters can get their hands on your personal information they can steal passwords to not only the gaming site, but also to the bank or credit accounts of anyone who uses that computer.

    They can also create a patchwork quilt of information that can allow them to eventually have enough on you to request duplicate identity documents (identity theft), and apply for credit in your name (identity fraud).

    Running up credit all over town, perhaps buying and selling goods in your name, or in some cases mortgaging properties –you may have a stack of credit defaults against your name by the end of their ordeal – and sometimes no proof it wasn’t you that didn’t initiate the credit in the first place.

    Recovery can be slow, and in some cases you may have no way to prove you weren’t responsible for the debt – with fraudsters leaving no trail and the actual identity theft happening long before the fraud took place.

    Who might be most at risk?

    Gamers often aren’t worried about risks to their personal information as they are often young people who consider they don’t have much to lose, when in fact they do. Firstly, if Malware is downloaded – it puts the entire family at risk. But secondly, a young person is just as vulnerable as anyone to exploitation. There have been reports of crooks harvesting the personal information of young people and storing it until the victim turn 18. Australian Police have issued warnings on the issue of data warehousing in relation to Facebook in the past, but fraudsters won’t be fussy about where they get it from. It all has a lucrative price on the ‘black market’ of personal information.

    For more help with teaching kids and young people about online risks, go to the Stay Smart Online website http://www.staysmartonline.gov.au/kids_and_teens.

    Visit our main website www.mycra.com.au for more information on identity theft and your credit file.

    Image 1: Arvind Balaraman/ www.FreeDigitalPhotos.net

    Image 2: Salvatore Vuono/ www.FreeDigitalPhotos.net

  • Mandatory data breach notification Bill before Parliament

    data securityThe Attorney-General has put before Parliament a mandatory data breach notification bill, which will require businesses and government agencies to notify people when a data breach affecting their privacy occurs. In our view this long overdue legislation is imperative to protect individuals who have their personal information unsecured in some way.  This will allow those individuals affected to take swift steps to secure their own records and personal information from identity crime. We look at why these laws are so important and how a data breach can impact a person’s credit file.

    By Graham Doessel, Founder and CEO of MyCRA Credit Rating Repair and www.fixmybadcredit.com.au.

    Remember when Sony was hacked? Thousands of Sony Australia customers were kept in the dark about it for some time – and there wasn’t a thing our Privacy Commissioner could do after the fact, due to there being no legal requirement in Australia on businesses or other entities to notify individuals when a data breach in their business could impact their personal information.

    Events like that – along with a long list of other breaches – have inspired changes within our legislation.

    The Attorney-General Mark Dreyfus QC handed over The Privacy Amendment (Privacy Alerts) Bill 2013, for its first reading in parliament yesterday. If passed, amendments will be implemented along with other major amendments to the Privacy Act 1988, on March 12, 2014.

    The new laws will require notification of data breaches to the Office of the Australian Information Commissioner, on all entities covered by the Privacy Act 1988, including many businesses.

    The notification requirements do not apply to all data breaches, only breaches that give rise to a risk of serious harm. The Commissioner will be able to seek civil penalties if there is serious or repeated non-compliance with the notification requirements.

    “To make sure that the new laws have teeth, the Information Commissioner will be able to direct agencies and business to notify individuals of data breaches,” Mr Dreyfus said in a statement to the media on Tuesday.

    In a Computerworld article ‘Proposed mandatory data breach notification bill read in Parliament’, Privacy Commissioner, Timothy Pilgrim, reportedly said he has supported the introduction of mandatory data breach notification laws in Australia since they were first proposed by the Australian Law Reform Commission in 2008.

    “The last couple of years have seen a number of high-profile data breaches and subsequent own motion investigations initiated by me, and research suggests that the frequency of data breaches in Australia has continued to grow over the past three years,” he said.

    Despite this upward trend, the Office of the Australian Information Commissioner (OAIC) received 46 data breach notifications in the 2011–12 financial year, an 18 per cent decrease from the previous year.

    “I am concerned that we are only being notified of a small percentage of serious data breaches that are occurring,” Pilgrim said. “Many critical incidents may be going unreported and consumers may be unaware when their personal information could be compromised.”

    Up to now, whilst organisations are encouraged to disclose data breaches to the Commonwealth Privacy Commissioner, it has not been mandatory to do so. There has been much criticism over companies “holding out” on their customers following a data breach, and waiting days or up to a week or so to notify customers that their personal information may be at risk.

    During this time, it has been argued that hackers have had free access to this personal information without the customer doing anything to minimise their own risk, such as cancelling accounts, changing passwords and flagging their credit accounts and credit file.

    We agree this is an area which is overdue for legislation, especially going in hand with other new Privacy Amendments already passed.

    We can’t take lightly the possibility that any company that keeps data on its customers could be exposed to data breaches. Identity theft is becoming more prevalent, and personal information is lucrative for fraudsters.

    Unfortunately it seems everywhere people turn some company has been hacked – and it seems every entity with a computer is vulnerable. It is still extremely scary the level of risk peoples’ personal information undergoes these days when it is stored online.

    Personal information in the wrong hands can lead not only to identity fraud, but the misuse of the victim’s credit file, which can have significant long term consequences.

    A lot of identity fraud is committed by piecing together enough personal information from different sources in order for criminals to take out credit in the victim’s name. Often victims don’t know about it right away – and that’s where their credit file can be compromised.

    Once the victim’s credit rating is damaged due to defaults from this ‘stolen’ credit, they are facing some difficult times repairing their credit rating in order to get their life back on track.

    These victims often can’t even get a mobile phone in their name. It need not be large-scale fraud to be a massive blow to their financial future – defaults for as little as $100 will stop someone from getting a home loan.

    Once an unpaid account goes to default stage, the account may be listed by the creditor as a default on a person’s credit file. Under current legislation, defaults remain on the credit file for a 5 year period.

    What is not widely known is how difficult credit repair following can be – even if the individual has been the victim of identity theft, there is no guarantee the defaults can be removed from their credit file. The onus is on them to prove their case and provide copious amounts of documentary evidence.

    Unfortunately data breaches are difficult for individuals to have any control over, and the only way people can ensure their details are safe are to demand that the companies they deal with have strong IT systems before disclosing that information.  People should adopt the philosophy of a need-to-know basis for disclosing their personal information. They should always question the need for it to be handed over. If it is not essential, they shouldn’t do it.

    The fact that our country is attempting to legislate this important area is a big step in the right direction. Forcing companies to act quickly would minimise the harm which could occur to the victims’ financial identity and credit file information. Whilst it won’t prevent all data breaches, it will encourage better security. A requirement to disclose potentially harmful breaches would mean a company’s bad security is thrown right into the limelight. And not even the big wigs would want that.

    Image: David Castillo Dominici/ www.FreeDigitalPhotos.net