U.S. moves to curb prying

Press, Volume CXI, Issue 32661, 17 July 1971, Page 12

U.S. moves to curb prying

(From RICHARD BEATTIE, in New York)

Invasion of privacy was once only the fear of a small elite the famous, the notorious and the rich. In America today it is the fear of every adult from the day he first applies for a credit card, insurance, or even a job. The scandalmongers of the last century are now the credit reporting agencies of today. The emergence of 2500 credit reporting organisations in the United States came with the tremendous growth of consumer credit spending, which is currently running at about $9OOO million a month and increasing. In an attempt to check on the reliability and background of people asking for credit, insurance, a job or an apartment, institutions and countless people claiming “a legitimate interest” in the personal affairs of others have been willing to pay for it. Right of challenge Of the 200 million men, women and children in America, 105 million have details of their lives in the dossiers of member organisations of the Association of Credit Bureaus of America. Much of the information relates to “hard data” or simple facts and figures about a person’s career, his income and his history for paying bills. Unlike the “soft data,” better described as gossip, “hard data” are most often inaccurately compiled because of mechanical faults and clerical errors which, when discovered, can be easily corrected. "Soft data” are not so easy to have corrected when they have been inaccurately gathered. Despite the importance to individuals of the contents of dossiers compiled by credit reporting agencies they have not been open to inspection and correction.

i Right of challenge ■Congress has recently enacted the Fair Credit Reporting Act, which went into effect in April, and now grants individuals the right to challenge the information that has been collected about them and sold. Before the Act was passed,

credit bureaus were able to distribute information that may have been completely inaccurate with no fear that they could be challenged in the courts for distributing libellous material. Now, however, the subscribers to the files of credit reporting agencies must notify consumers or job applicants of the name and address of the agency that has supplied the information if credit or employment is refused on the basis of the report. Individuals may then see their file on request and insist on corrections if some mistake has been made when the report was compiled. Ralph Nader, the consumer advocate, wrote in a recent article in the New York “Saturday Review’’ that "soft data” were inherently unable to be checked because they were based on the opinions and hearsay reports of people who said that they knew the person being investigated. 1 Hurried inquiries “Even when bias is not present innuendo or misunderstanding can create error, while a vindictive inspector; can abuse his power for personal reasons,” Nader wrote. .. . The occasionally malicious mis-reporting but more often just shoddy reporting, that can affect the course of an individual’s career and life for many years, can be explained by the short tune allowed by the agencies for their men to make inquiries. Nader reported that they spend only 40 minutes on an ayerage report and this includes the time taken to travel to see neighbours and that required to type it. “This aljows no time for checking accusations, or even facts,” he said.

“Good diggers”

“A more vicious reason is the agency’s penchant for derogatory information and the fact that it records on both a weekly and monthly basis the percentage of cases in which an inspector recommends refusals.” He must file a certain percentage of derogatory reports (at one time 8 per cent for life insurance policies and 10 per cent for reports on driving records) if he was to be known as a “good digger.” If he had not met his

quota, the temptation to use any rumour, without confirmation, may be overwhelming. These quotas may be regarded by the agency as a necessary control device to prevent inspectors filing fake reports without investigation, but they show a reckless disregard for the safety of the investigating public. Classic example A classic example of misreporting occurred when an agent of Retail Credit Company of Atlanta, Georgia—the largest—with 45 million files, advised an insurance company not to issue a policy to two women who required it to cover a business deal. Retail credit reported “severe criticism of the morals of both women, particularly regarding habits, and lesbian activities.” The investigator’s information came from neighbours, none of whom claimed to have seen any illicit activities but managed to imply as much in their comments. ; The policy was refused and the women had no opportunity to find out why. Another requirement of the Fair Credit Reporting Act is that when a dispute about the accuracy of a report arises the agency must reverify or delete the information. Sources protected •- This requirement may be of little comfort to people who believe they have been incorrectly branded homosexuals or drunks when they know that the agency is likely to go back to the same sources who first divulged the information. One apparently glaring inadequacy of the act is the' omission of any obligation on the part of the credit reporting agencies to divulge the sources of their information.

Professor Alan F. Westin, of Columbia University, New York and author of "Privacy and Freedom,” wants regulations on the type of information that can be collected and disclosed: a writ of “hamea data” that would allow an individual to find out what* his files contain, to challenge' their accuracy, and to contest any items he feels are in error; and a public agency to review data bank’s operations and provide a source of appeal for wronged individuals.—John Fairfax Feature Services. . x