Barclays told to review underwriting processesadmin November 28th, 2011
28 November 2011 | By Samuel Dale of Mortgage Strategy
The Information Commissioner has urged Barclays to review its underwriting practices after possible breaches of the Data Protection Act.
Dale Robinson, a broker at Town & Country, complained to the IC after one of his clients had her mortgage application rejected as a result of multiple unnecessary credit searches by Barclays.
After she received her decision in principle, Barclays carried out an initial credit search on the client. However, the bank’s system showed an inconsistency regarding her address. The system carried out a further two searches and its underwriting team did a fourth search.
Robinson claims the application was subsequently rejected because of the multiple credit searches.
The IC ruled that three of the searches had been unnecessary.
In its ruling the IC says: “It is unlikely that Barclays has complied with the requirements of the DPA. It appears unlikely that it has processed the client’s personal data fairly, when it conducted four searches of her credit report in connection with her mortgage application.”
Robinson is now seeking compensation and an apology on behalf of his client.
The IC says although it is not taking further regulatory action, it has asked Barclays to take steps to prevent a repeat of the situation.
Barclays says it is already making changes to its software and has put in place temporary safeguards.
It adds that it has made its underwriting team aware of the occasions when a new full credit search will be required.
A spokeswoman for Barclays says: “Barclays takes its data protection obligations seriously and if we were to identify issues or they were brought to our attention we would take action to correct them.
“Barclays is committed to ensuring personal information about our customers is accurate.”