The credit reporting act 2010 (megan deane)

A Creditinfo Seminar

on

Jamaica’s New Credit Reporting Environment

Wednesday June 6, 2012

Knutsford Court Hotel, Kingston Jamaica

The Credit Reporting Act 2010

MEGAN DEANE CHIEF EXECUTIVE OFFICER CREDITINFO JAMAICA LIMITED

Creditinfo Jamaica - Structure

Partnership between Creditinfo Group and Coalesce Credit Solutions

Creditinfo Jamaica Ltd

Creditinfo Group Hf Coalesce Credit Solutions Ltd

Credit Bureau Licence - Process

• Applied to the BOJ in March 2011

• Individual Fit & Proper

• Assessment of Proposed:

– Specialised Experience

– Policies & Procedures

– IT System Infrastructure

– Business Financing

• System Prototype Demonstration

• FIRST Credit Bureau Licence granted - March 7, 2012

Credit Bureau Licence - Mandate

• Sign credit information providers as subscribers

• Embark on Public Awareness Campaign

• Setup Creditinfo Credit Bureau Solution (CBS)

• Transfer subscriber credit data to Creditinfo database

• Test CBS with Subscribers

• Implement business policies and procedures

• Final assessment by the Bank of Jamaica

• Live Credit Bureau

• MORE INFORMATION TO REDUCE RISK

Creditinfo Jamaica - Vision

“To be the leading Credit Information Bureau in the Caribbean region, providing

consistent and reliable credit and other information to our clients while

contributing to national growth and development.”

Creditinfo Jamaica - Mission

“To provide consistent and reliable credit information to the financing sector and

the public, complemented by comprehensive data analysis and other

related services”

Creditinfo Group’s Values

• Innovation: We are willing to look at innovative ways to fulfill the needs of our customers

and partners. We are not afraid to do something that has not been done before

• Respect: We respect our customers, partners and any other stakeholders. Every employee

in our company should feel appreciated. We respect cultural diversities

• Service-minded: We are customer oriented and do our upmost to provide good service

both inside and outside the company

• Co-operation: We can achieve more, faster and better if we work together as a team. We

give advice freely and share our knowledge. We help each other

• Effective: We are practical and down to earth. We use our resources to create value for

our customers and partners. We do not waste time and money, nor do any other things

that are not in some way contributing to achieving our strategy and goals. We are not a

bureaucratic company

Creditinfo Jamaica’s Values (Aligned to Group)

PROFESSIONAL CONDUCT

• We will approach our data gathering and dissemination with integrity and professionalism, always balancing the confidentiality of our operations with the right of business and individuals to informed decision-making

TRANSPARENT ORGANISATION

• We will conduct our business within the regulatory framework with equity, transparency, accountability and lack bureaucracy

SATISFIED CUSTOMERS

• We are responsive to the needs of our customers and deliver customer service above and beyond expectations

MOTIVATED STAFF

• We will create a work environment that is open and honest, which promotes teamwork and develops highly motivated and committed staff

PROACTIVE ATTITUDE

• We will be innovative, creative and proactive, to ensure that Creditinfo Jamaica remains on the cutting edge of the credit information industry.


• The Act was promulgated into law on August 31, 2010

• Provides for the sharing of credit information between specified bodies, the licensing of credit bureaus and for connected matters

• Object is to ensure that credit reporting is done through reasonable procedures that meet the needs of commerce for credit information in a manner that is fair and equitable to the consumer having regard to the confidentiality, accuracy, relevance and proper utilisation of such information


The Act applies to the disclosure

a) Of credit information by an entity in Jamaica to another entity in or outside Jamaica

b) By any entity outside Jamaica, of credit information relating to any transaction, in whole or in part, in Jamaica

NB. A company that discloses credit information in any other

country, in return for monetary payment or other reward,

shall, for the purposes of the Act, be deemed to have made

such disclosure in Jamaica.

The Credit Reporting Act 2010 Section 8 Subsection 2 of the legislation provides for which types of entities may be data providers to a Credit Bureau. They are,

• A bank licensed under the Banking Act

• A financial institution licensed under the Financial Institutions Act

• A building society licensed under the Building Societies Act

• A society registered under the Co-operative Societies Act

• The Development Bank of Jamaica Limited

• A dealer in securities who is licensed under the Securities Act

• Any person who carries on the business of selling goods under hire purchase, credit sale or conditional sale agreements, as defined by the Hire Purchase Act

• A person who publishes information on suits and judgments for debt claims

• A credit bureau

• An insurance company registered under the Insurance Act

• The National Housing Trust

• The Students’ Loan Bureau

• An entity exempt from the provisions of the Moneylending Act by section 13 of that Act*

• Such other body, other than an individual, as the Minister may designate to be a credit information provider by notice published in the Gazette and in at least one daily newspaper in circulation throughout Jamaica

* SECTION 13 OF THE MONEYLENDING ACT

13.-( 1) This Act shall not apply to-

a) any Friendly Society, or to any Building Society or Benefit Building Society, registered under the Friendly Societies Act or the Building Societies Act respectively or any enactment amending or substituted for the same, or to any loans made by any such Society; or

b) any Society registered under the Industrial and Provident Societies Act or any enactment amending or substituted for the same, or to any loans made by any such Society; or

c) any body corporate, incorporated or empowered by an enactment of the Legislature of this Island to lend money in accordance with such enactment; or

d) any company licensed under the Financial Institutions Act; or any company licensed under the Banking Act; or any loan to or contract or security for the repayment of money lent to a body corporate incorporated in Jamaica by or under any enactment or by royal charter; or any insurance company registered under the Insurance Act, in the course of whose business and for the purposes whereof it lends money; or any person whose main business is not the lending of money and who lends money solely incidental to the conduct of such business; or any loan or contract or security for the repayment of money lent at such rate of interest not exceeding such rate per annum as the Minister may by order *prescribe; or a licensee under the Securities Act; or an entity

– (i) which is established by a statutory body or authority; and

– (ii) the primary purpose of which is to lend money.


Under the legislation, a person who discloses credit information about a consumer in return for monetary payment commits an offence unless they are,

• A licensed credit bureau

• A credit information provider to another credit information provider

• An affiliated company having the same consumer client

• Authorised by the court

With the legislation, use of the words “Credit Bureau” or any other words which could reasonably be construed as indicating that the person carries on the business of a credit bureau constitutes an offence


A company may apply for a licence under the Act.

Creditinfo Jamaica applied and received a licence with several conditions

• Operation to commence within twelve months

• Appropriate organisational arrangements

• Details on proposed disposal procedures for inaccurate information

• Signed Data Providers Agreements

• Appropriate insurance coverage

• Demonstration to the BOJ of the Credit Bureau System

• Documented MIS and IT Security Protocols

• Physical location inspection and approval


The Bureau has as its supervising authority the Financial Institutions Supervisory Division of the Bank of Jamaica which will oversee,

• Fit and Proper Status of a credit bureau’s principals

• The security protocols of the credit bureau system

• The integrity of the data in the credit bureau system

• The financial sustainability of a credit bureau

The Credit Reporting Act 2010 Credit information includes

• The Consumer’s name

• Present and past addresses

• Taxpayer Registration Number (or other numeric reference)

• The amount and nature of loans and advances or other credit facilities granted by a credit information provider

• The nature of the security taken in respect of credit facilities (including lease financing or hire purchase arrangements)

• The nature of any guarantee or other non-fund based facility

• Information about financial means, creditworthiness or history of financial transactions (including antecedents and adverse court judgements)


Credit information includes

• Analysis of that information including any conclusions as to creditworthiness, whether in the form of a system of numerical or alphabetic scores or otherwise

• Any credit related information that the Minister specifies, in directions issued by the Minister by notice published in the Gazette, as appropriate to include.

The Credit Reporting Act 2010 The Responsibility of Credit Data Providers

• Not to disclose credit information about a consumer to a credit bureau without first receiving the consumer’s consent in writing

• Provide reliable information (accurate in all material respects; is fair and balanced; does not include personal information unless the consumer consents in writing attached to the information);

• Publish in a daily newspaper in circulation in Jamaica at least seven (7) days before first commencing the provision of any credit information, a notice stating its intention to do so;

• Advise in writing every applicant for any credit facility at the time of application a notice indicating that credit information may be supplied to a credit bureau;

• Advise a consumer if credit is denied due to any information in a Credit Report and provide information as to the Credit Bureau or Credit Information Provider that provided the report.

The Credit Reporting Act 2010 The Responsibility of Credit Data Providers Not use or disclose information received from a credit bureau except,

a) in connection with, the extension of credit to; a guarantee or other non-funds based facility for, or the purchase or collection of a debt incurred or guaranteed by, the consumer to whom the information pertains;

b) with the written permission or directions of the consumer and without monetary reward, for the purposes of,

- the employment of the consumer;

- the underwriting of insurance for the consumer;

- facilitating a financial or commercial transaction involving the consumer; or

(c) for purposes of updating any credit information disclosed before;

CONTRAVENTION OF RESPONSIBILITIES CONSTITUTES AN OFFENSE

The Credit Reporting Act 2010 Consumers and Complaints Procedure

Provision of written notice to the Credit Information Provider or Credit Bureau that the consumer’s credit information has been or may be affected by a fraud committed by another person,

• The Credit Information Provider will deliver copy of the notice to all whom it had disclosed the credit information and in the case of the Bureau, to the Provider who provided the information.

• Include a copy of the notice with any subsequent disclosure in relation to the consumer until the notice is rescinded in writing to the Bureau.

If the Bureau discloses inaccurate information unknowingly, it is required to,

• Give notice in writing of the inaccuracy to all who previously pulled the report

• Take steps to correct the inaccuracy

The Credit Bureau & Data Providers

THE CREDIT BUREAU WILL,

• Maintain a Register of Credit Information Providers from which credit information has been requested or obtained including,

(a) Name and Address

(b) the number of instances in which

(i) that provider gave information that was not reliable

(ii) the accuracy of credit information provided by that provider was

disputed by a consumer

And also advise that Information Provider accordingly in writing and include in the Register any written response

(c) the resolution or otherwise of the instances outlined

• The Bank of Jamaica, as the Supervising Authority, operates a protocol in respect of Credit Information Providers that contravene any aspect of the legislation, which protocol includes suspension of data provision and consequent inability to pull data.

Offences and Penalties under the Act

Penalties range between $250,000.00 and $2,000,000.00 or imprisonment for terms ranging between six months and one year or both such cash fine and imprisonment

• Disclosure of credit information for monetary payment or otherwise

• Obstruction of officer executing warrant

• Knowingly, or recklessly supplying false information, etc. in licence application

• Using the words “credit bureau” etc. in name without licence or approval

• Failure to give notification of change in particulars

• Disclosure of unreliable, confidential or personal information; failure to correct unreliable information

• Disclosure of credit information obtained from person other than credit information provider

• Failure to maintain register of credit information providers

• Obtaining or disclosing information while prohibition notice is in effect

• Unlawful disclosure of credit information by credit bureau

• Unlawful use of credit information

• Breach of Confidentiality; knowingly using or disclosing credit information obtained in contravention of the Act

• Failure to comply with requirement or directions of supervising authority; wilfully misleading or obstructing supervising authority

• Inclusion of false information in statement etc. relating to amalgamation or transfer

• Refusing to produce books or documents or to answer questions put by investigator

• Failure to comply with directions of Minister.


Thank you

QUESTIONS AND ANSWERS

Economy & Finance

The credit reporting act 2010 (megan deane)