© CASSANDRA, JHALAK AND SHEENAL PRODUCTIONS

What it is?It is the record of an individual’s ability to repay debt that is based on the past history of the person’s borrowing and repaying in conjunction with the entity’s availability of assents and income to pay off future debt.

Where can you obtain your credit rating from?

Credit Rating Agencies such as Baycorp and Veda Advantage can provide one with their credit worthiness value.

Since a database is a collection of related data to a particular subject, credit rating agencies utilise databases to record data on an individuals credit rating details (such as past debt, whether they are punctual in paying off credit card debt) and personal information that allows credit rating companies to identify the individual. Databases are used to store data on an entity through the use of different fields containing information on the individual to formulate their credit score.

Some of the data included in a credit rating database for an entity are: Full Name One’s interest charged Debt that needs to be paid (This is amount of money needed

to be paid for its use.) Amount of credit used (This is amount of money used

from borrowing) One’s saving patterns (This is person's abilities to save

money and repaying money) Rating of payment of loans (This is in percentage, if its high

then you have more spending money)

Someone can use previous good credit rate for before and bank would still let them borrow if an agency’s credit rating database is not up-to-date.

A person managing credit rating databases may give away a client’s personal details to a individual or organisation without the client’s information.

A employee from a credit rating agency may fool an individual to provide personal details that are not necessary to formulate one's credit score.

Repair clinics have been set up to help one with bad credit rating. These so-called clinics offer to help you clean up your credit by using loopholes in the law that only they know about. They may also promise to remove negative information from your file or to get you a major credit card. These are false promises.

“Lugi wants to know if you the manager of the credit rating database, could fix a few minor

details on his account”

WHY?Under the Federal Privacy Act 1988, credit rating agencies (they manage the databases) MUST ADHERE TO A STRICT CONDUCT. If conduct is BREACHED, PENALTIES OCCUR.

LEGAL OBLIGATIONSThose who gather information to produce a record on a entity are forbidden to obtain personal information in one’s credit information file unless that type of information is reasonable essential to identify the individual.

CREDIT RATINGNAME: JOHN CITIZENPERSONAL INFORMATION:• Medical History• Criminal Record• Physical handicapcy• Political beliefs• Religious beliefs• Race and ethnic origins

LEGAL OBLIGATIONS Those in charge of modifying databases in credit rating agencies must make sure information on a individual is up-to-date, accurate and not-misleading.

Eg: Sally-Anne paid off her credit card debt 6 months ago, when she approaches Commonwealth Bank to get a loan, they inform her that her credit worthiness is not upto the standard the bank requires to lend out a loan.The inability for a credit rating agency to update their record has left Sally-Anne unable to obtain a loan.

Commonwealth Bank

To: Sally Ann

Loan: $15, 000

LEGAL OBLIGATIONS<> Must secure database against unauthorised access, loss of data and misuse of data.

If this occurs, the Privacy Commissioner (that regulates credit rating agencies) can give out penalties such as fines and criminal records. <> Not allowed to disclose personal information to either a person or an organisation other than the individual who’s credit worthiness is measured and those who have received permission to access from the individual.

CREDIT SCORE AGENCY

“Mr. Howard has a bad credit rating score – pass it on!”

ETHICAL OBLIGATIONS

<> We live in a society that believes in a high standard of morality. In this society those managing the databases in credit rating agencies have responsibilities to carry out their work justly to the information they withhold on others. Many of these responsibilities are relevant to their legal obligations:

They have a right to provide confidentiality among the individual and themselves by not leaking out the personal details to another person or organisation unless the person who desires to observe the information has proper authority and individual’s consent to view.

They must assure that one’s credit rating is accurate.

<> They have a right to provide confidentiality among the individual and themselves by not leaking out the personal details to another person or organisation unless the person who desires to observe the information has proper authority and individual’s consent to view.

<> They must assure that one’s credit rating is accurate.

ACCURATE

CONFIDENTIAL

Credit rating is an estimated figure demonstrating how you appear to credit lenders in your credit worthiness, it is one’s indicator of obtaining future credit. Information include in credit rating databases such as payment history,outstanding debt, debt utilisation and how long you have lived in your home. An ethical and legal responsibility is to ensure that information placed as one’s credit rating is accurate.

What is Credit Rating?

How are Databases

Involved in Credit Rating?

What are the types of data stored about

individuals in a credit rating?

Cassandra

Cassandra

Jhalak

How the data in a credit rating can be misused in different ways are?

What are the legal

responsibilities of those managing

credit rating databases?

Jhalak

Sheenal

What are the ethical

responsibilities of those managing

credit rating databases?

Sheenal