Equifax Australia to Pay Aus$3.5 million Penalty for Misleading Consumers on Credit Reports

Moneylife Digital Team 02 October 2018

The Australian Federal Court has ordered Equifax Australia Information Services and Solutions Pty Ltd (Equifax) to pay penalties totalling Australian $3.5 million for misleading and deceptive and unconscionable conduct in relation to credit report services. This follows joint submissions by Equifax and the Australian Competition and Consumer Commission (ACCC).

In a statement, the ACCC commissioner Sarah Court says, “Equifax’s conduct caused people to buy credit reporting services in situations when they did not have to. Consumers have the legal right to obtain a free credit report under the law.”

Equifax admitted it breached the Australian Consumer Law (ACL) in 2016 and 2017, when its representatives made false or misleading representations to consumers during phone calls.

Equifax told consumers that its paid credit reports were more comprehensive than the free reports it had to provide under the law when, in fact , they contained the same information.

Equifax also admitted it told consumers they would be charged a single ‘one-off’ or ‘one-time’ payment, but failed to disclose that payments for its paid credit report packages would automatically renew unless consumers opted out.

“We considered it unacceptable that consumers were denied the knowledge and proper opportunity to opt out of recurring charges from Equifax,” Ms Court said.

Equifax also told consumers that the credit score provided in its paid credit reports was the same credit score used by credit providers when that was not always the case.

In respect of three vulnerable consumers, Equifax also admitted that it acted unconscionably by using unfair sales tactics and making misleading representations during telephone calls.

“It is appalling that Equifax used unfair sales tactics on consumers who were vulnerable,” Ms Court said.

“Consumers have a right to receive accurate information from credit reporting companies when they seek advice or services.”

“This result sends a strong message to businesses that making misrepresentations and acting unconscionably against consumers will not be tolerated,” Ms Court said.

The court also ordered, by consent, that Equifax establish a consumer redress scheme which will allow affected consumers to seek refunds for a 180-day period.

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