Creditors of failed telco One.Tel were dealt another blow on Monday with 65,000 debtor default listings scrubbed out after the Federal Privacy Commissioner found the company's credit and billing systems were so bad there was no way to accurately differentiate between paid and unpaid bills.
Credit reporting agency Baycorp Advantage has also removed the One.Tel default records after being given advice by Privacy Commissioner Karen Curtis that One.Tel's billing records could not be sufficiently trusted because it "did not have systems in place to update customer credit default listings once a debt had been paid".
In the stiffest warning to the business community since her appointment in July, Curtis said businesses that could not get their billing systems to perform face being barred from listing customers as defaulters.
"Businesses that do not have such systems or the information necessary to ensure the accuracy of their records run the risk that they too could have default listings removed from credit records," Curtis said.
The decision by Baycorp to purge One.Tel's defaulter records came after the reporting agency and debt collector combed through the telco's credit record statistics to find an alarmingly low number of credit record updates in comparison to other credit providers.
A spokesman for Baycorp Advantage said he was unable to comment or put a dollar value on the purge because of legal concerns surrounding One.Tel's ongoing liquidation.
However, the spokesman confirmed a statement from the Privacy Commission, which said "only a relatively small number of One.Tel listings had been updated".
Baycorp Advantage has also cancelled the access of One.Tel in Liquidation's – the name of the holding company - to its credit reporting services and will wear the cost of sending out "updated credit information files to any individual who has obtained a copy of their personal file in the last three months" and "whose file has been affected by this change".
The Privacy Commission's action follows a long line of complaints from both businesses and consumers about inaccuracies stemming from latency, duplication and lack of reconciliation in telco billing systems.
In July 2003 the Australian Communications Authority stripped telcos across the nation of their ability to sell disputed debt ledgers (debt books) to third-party collection houses following a huge spike in complaints to the Telecommunications Industry Ombudsman.
Originally backed by media heirs James Packer and Lachlan Murdoch and others, One.Tel collapsed in 2001 leaving debts of about $2.5 billion.