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When Barbara applied for a loan, the bank rejected her due to a credit default listing by TelcoZ

The complaint
Consumer had a debt to a provider for a service they never resulting in a default listing that affected their ability to secure a home loan.
The outcome
The consumer had the credit default removed and received compensation from the service provider.

The issue

satelite tower

Barbara* had a landline service with TelcoZ*. When Barbara moved house, she asked TelcoZ to transfer the landline service to her new address. However, TelcoZ said it couldn’t provide service there. After she moved house, TelcoZ didn’t send Barbara any bills so she called and TelcoZ said she did not owe it any money.

In 2018 Barbara applied for a loan. The bank rejected her application saying she failed its credit check. Barbara asked for a copy of her credit file and found TelcoZ had applied a credit default against her name for unpaid bills it sent to her old address. Barbara complained to TelcoZ and it agreed to remove the credit default. From this time, TelcoZ had 30 days to update Barbara’s credit file.

Three months later Barbara applied for another loan and again the bank rejected her application saying she failed its credit check.

The investigation

Barbara called us to complain. She said each time the bank rejected her application she felt embarrassed and humiliated. Barbara said she wanted TelcoZ to remove the credit default listing and pay her $3,000 in compensation.

The outcome

We showed TelcoZ what other Ombudsman schemes had recently paid consumers for similar complaints. We said $500 would sufficiently compensate Barbara for her non-financial loss.

TelcoZ offered to remove the credit default listing within 30 days and pay Barbara $500. Barbara accepted the offer.

*Names of individuals, organisations and companies have been changed.

How we've helped other customers

Telco E sells technical support to customers who do not understand or need it
Telco E retrained its staff about the service. It also gave customers who were signed up to the service the option to cancel without a cancellation fee
Telco C credits customers who received high bills after using a ‘pre-paid’ service
We worked with Telco C to help it improve the information it gave customers about possible data charges