ACCC/ASIC Debt Collection Guideline
Submission by the Australian Privacy Foundation (APF)
July 2005

The Australian Privacy Foundation is the main non-governmental organisation dedicated to protecting the privacy rights of Australians. The Foundation aims to focus public attention on emerging issues which pose a threat to the freedom and privacy of Australians. The Foundation has led the fight to defend the right of individuals to control their personal information and to be free of excessive intrusions. The Foundation uses the Australian Privacy Charter as a benchmark against which laws, regulations and privacy invasive initiatives can be assessed.  For information about the Foundation and the Charter, see www.privacy.org.au  

Comments on the draft Guideline

Part 2 Section 3 includes suggested hours of contact – 7.30 am - 9 pm on weekdays and 9-9 on weekends, but not at all on public holidays.  These differ slightly from the hours recommended for telemarketing in the ADMA Direct Marketing Code of Practice, which are between 8am and 9pm on all except 3 specified public holidays. There might be some advantage in consistency, although we would defer to other consumer organisations in the ‘front-line’ of assistance to individuals if they thought particular hours were more important than consistency.

Part 2 Section 7 on Privacy is generally a useful addition, although its inclusion does not mean that many of the other sections do not set out processes that contribute directly to compliance with privacy principles – they do (e.g. most sections – especially 1-6, 16 & 18 - contribute to NPP 1, section 9 to NPP3, section 10 to NPP6 etc).  While there are already some useful cross references, it would be desirable to expressly point this out at the outset.

7(b) includes the example

“Telling a debtor’s neighbour the reason for trying
to find the debtor might be disclosing personal information about the debtor.”

The ‘might be’ should be replaced with ‘will be’.  A better or additional example at this point might be that

“merely telling a neighbour that you are looking for the individual, if the neighbour has reason to believe you are a debt collector, will constitute disclosure of personal information”. 

We note that a version of this example is given in 7(d) – fifth bullet point, but it is essential to convey the message that it is not enough for the debt collector not to expressly say that they are collecting debts if it is reasonably obvious from the context, or from any stationery/signage etc that this is their job.

In 7(f), first bullet point, some guidance/examples about retention periods in the context of debt collection would be useful

7(f) also states (third bullet point):
“If the information is kept for any time, ensure it is secure against loss or
unauthorised handling”  

The security obligation under NPP4 is not time dependent – the qualification “If the information is kept for any time” should be deleted.  It would be acceptable to emphasise that the obligation becomes more onerous the longer the information is kept.

7(g) includes a circular reference – debt collectors … to … debt collectors.

We support the view put by CCLC(NSW) in their submission that Section 19(i) appears to be too restrictive. While there cannot be an indefinite prohibition on making an adverse credit listing in relation to a disputed debt it would appear to be consistent with Para 12 [c] to suggest that you should not make an adverse credit listing while you are in the process of investigating the debtor’s claim that a debt is disputed. The effectiveness of para12 [c] would be defeated if this were not the case. We support the suggested addition of another subsection to this effect.

Section 23 on external dispute resolution should make reference to complaints role of the Privacy Commissioner in relation to any breaches of the NPPs or PtIIIA/Code of Conduct.  As a statutory office, the Privacy Commissioner needs to be distinguished from the non-statutory Ombudsmen referred to in this section.

Generally, the sections on internal and external complaints processes (22 & 23) are not well integrated with Part 3 on consumer protection laws and Appendix A on the roles of ACCC & ASIC.

While this is probably more important for the proposed consumer guide, the debt collectors and creditors at whom this Guideline is aimed also deserve a clearer explanation of the various options and stages in relation to complaints.

End.

Australian Privacy Foundation
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APF Web site: http://www.privacy.org.au