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Privacy Case Note 16 discusses the complaint of a customer against their financial institution which terminated the additional cardholder’s access to the credit account as requested but allowed the additional cardholder's internet access to the account to remain active, thereby allowing the additional cardholder to view the current transaction history of the credit account.

The financial institution resolved the matter directly with the complainant by providing an explanation of the incident, amending its practices and agreed to a payment of compensation.

The financial institution advised that the credit account was linked to internet banking whilst the additional cardholder status was still valid. As the financial institution did not require the principal cardholder to give approval for internet access to be granted to the additional cardholder, the request was manually approved and sent to the operations centre of the financial institution for processing. The request to remove the additional cardholder took twenty four hours to process and as such, the existence of the internet linkage to the credit account was not apparent until the day after it was requested. The financial institution explained that although the complainant requested cancellation of the additional cardholder’s access, the manual verification process and the twenty four hour processing period meant that the internet linkage was not detected and actioned by the financial institution.

The financial institution advised that the process for verifying and allowing access to credit accounts via internet banking had subsequently been completely automated so that when access is removed or the account is closed, the corresponding internet linkage is also amended or removed.

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Revised exposure draft AML/CTF Bill and draft AML/CTF Rules

The Minister for Justice and Customs, Senator the Hon Chris Ellison, has released a revised exposure draft AML/CTF Bill 2006 and draft AML/CTF Rules for a period of three weeks of public consultation from 13 July 2006.

The revised exposure draft AML/CTF Bill 2006 and draft AML/CTF Rules follow consideration of comments on the Exposure Bill and sample Rules released on 16 December 2005 and the findings of the Senate Legal and Constitutional Legislation Committee inquiry into the exposure Bill.

The Minister also released a summary of changes to the exposure Bill and a summary of the draft AML/CTF Rules.

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Titles Office fees change from 1 July

Queensland, New South Wales, Victoria, South Australia, ACT and Western Australia have introduced a new schedule of fees for land title services from 1 July 2006 (WA from July 10, 2006). Northern Territory and Tasmania have not announced any changes.

For more information contact your local Network Law representative.

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Unsolicited increases in credit card limits

The Banking and Financial Services Ombudsman's latest Bulletin (pdf) discusses procedures lenders should follow in resolving disputes over making unsolicited offers to increase credit card limits.

Giving an example of a person on an annual income of $38,000 who was experiencing difficulty meeting the minimum monthly payments on credit cards with two lenders with limits totalling $41,000, the Ombudsman has suggested that lenders should apply their criteria for new credit to the financial position of the disputant at the time the unsolicited offer was made to establish the amount that should have been offered.

The Ombusdman also discusses a number of cases where inaccurate or incomplete information was provided to the lender in the application for a new credit card. In some cases it is said that, if the lender had undertaken verification of that information, the inaccuracies or missing information could have been discovered.The Ombudsman considers that in most cases of credit card lending the lender is entitled to rely on the information provided by the applicant. However, he will consider whether the information provided was clearly incorrect or nonsensical on its face.

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