Select Committee on Enterprise and Economic Strategy debate -
Tuesday, 6 Sep 1994

SECTION 84.

Mrs. O'Rourke

I move amendment No. 219:

In page 48, subsection (2) (a) (vii), line 17, after "APR" to insert "expressed as £ per £100 borrowed".

The provisions of this section are being extended in this proposal which is in keeping with amendment No. 73. The reason for this amendment is that APR expressed as pounds per £100 borrowed makes more sense to persons who avail of credit from moneylenders.

If a collector of credit presents him or herself to a person who is in difficult financial circumstances at a door of a terraced house somewhere, I do not know that the phrase APR makes any sense to the person confronted. It is our duty to try to make it as plain as possible to persons who avail of credit from moneylenders rather than other forms of credit. This recommendation came from the Director of Consumer Affairs.

Mr. M. McDowell

Could the Minister tell me whether the phrase "expressed as £ per £100 borrowed" lies inside or outside the bracket after APR? If she looks back at line 17, it would make more sense if it was outside the brackets.

Mrs. O'Rourke

To leave the phrase inside the brackets denotes that it is not important.

Mr. M. McDowell

It is not APR. I do not know what it is.

Mrs. O'Rourke

It also denotes that it is not important somehow or another if it is in brackets.

Mr. M. McDowell

Could we insert the bracket after the term "APR" by agreement?

Mrs. O'Rourke

There is no difficulty about that.

Mr. M. McDowell

It would be nonsense to express £ per £100 borrowed as APR. It is not the same.

Chairman

Are you proposing a substitute amendment or will the Minister come back on Report Stage?

Mr. M. McDowell

Could we move the bracket within the quotation mark there? I think that was what the Minister meant to do.

Mrs. O'Rourke

Yes, it was just overlooked. We will come back on Report Stage so that we will have it correct.

Amendment agreed to.

Section 84, as amended, agreed to.

SECTION 85.

Mrs. O'Rourke

I move amendment No. 220:

In page 48, subsection (1), lines 33 and 34, to delete "moneylenders" and substitute "moneylending".

It is a textual correction and came from the Director of Consumer Affairs.

Amendment agreed to.

Mrs. O'Rourke

I move amendment No. 221:

In page 49, subsection (2), line 14, after "moneylender" to insert "or a person acting on his behalf".

Amendment agreed to.

Question proposed: "That section 85, as amended, stand part of the Bill".

Mr. R. Bruton

Section 85 (2) makes it an offence to reveal confidential information. Who prosecutes offences under this section? Is it the Director of Consumer Affairs or the Director of Public Prosecutions? The Coolock Community Law Centre raised the query and felt that it should be clear that it is the Director of Public Prosecutions who prosecutes the offences and decides whether they are to be dealt with on indictment or summarily. It does not apply only to this section. Section 85 (2) sounds like a nice provision to apply to all credit agreements but we do not appear to be applying the rule to credit referencing agencies.

Mrs. O'Rourke

Is the Deputy talking about the data?

Mr. R. Bruton

Yes. I would prefer this rather than the credit referencing agencies, or at least they should be policed in some way.

Mr. M. McDowell

I agree, except that I am coming at it from the other angle. Members of the consumer credit association should be entitled to show each other records in order to demonstrate that somebody is——

Mrs. O'Rourke

That is going back to what kind of data is protected. Are members not entitled to inform each other that people are bad risks in the same way as banks are entitled to? Deputy Bruton does not agree with——

Mr. M. McDowell

He wants to make it general. I am coming from the other end of the equation. Is it desirable that moneylenders are not allowed to share information on people in order to avoid bad risks?

Mrs. O'Rourke

We had this debate earlier in Kildare House. I was amazed at the extent of data cross referencing between financial institutions in examining the history of people seeking credit.

Mr. M. McDowell

The banks would charge you for doing it to you.

Mrs. O'Rourke

I was disabused of my naive notions when they came to see me and I raised what I thought were quite legitimate concerns about the matter. Apparently it is just a business now. The information is bought and fees for it are charged to the inquirer. Deputy Bruton asked about section 85 (2) which requires records maintained by a moneylender to be treated as confidential and prohibits the moneylender from revealing those records to unauthorised persons. What Deputy McDowell has raised is whether collector credit people are entitled to tell one another about bad risks or bad debts in the same way as banks do. Is that what the Deputy asked?

Mr. M. McDowell

Yes, there should be some kind of solidarity. It should not be the case that they commit an offence if they inform each other about bad debts.

Mrs. O'Rourke

That takes into account the other business which is now in place and fully operational. Deputy Bruton asked me whether the Director of Consumer Affairs would actually prosecute these offences. Different people are specified under different circumstances. An offence may be prosecuted summarily by the Director of Consumer Affairs or the Minister or such person as may be prescribed in relation to the offence according to the weight or nature of the offence. It should be the Director of Public Prosecutions.

Mr. R. Bruton

An opinion was expressed that it should be the Director of Public Prosecutions in all cases. I do not know what the merits of that argument are.

Mrs. O'Rourke

Was the Deputy querying the moneylending aspect of it?

Mr. R. Bruton

No, I thought this blanket ban on exchanging information was interesting in that the Minister look a very different attitude to the banks. I am not altogether happy with the restrictions laid down in section 118 for the other credit institutions. I am not happy with the protection for the consumer. It is curious that the framers of the Bill recognise that exchange of information may go too far and have decided to ban it for moneylenders. Perhaps Deputy McDowell is right. Let us agree a set of regulations fair to consumers under which information is exchanged and apply it evenly to any lending institution. That is an area to be addressed and as I am conscious of the Chairman's eagerness to proceed, perhaps now is not the time to do it.

Mrs. O'Rourke

I queried this exchange of information in regard to the banks. A person who came to see me had been refused credit and could trace it back to information received through an exchange of data. People engaged in moneylending have the benefit of data protection legislation and perhaps there is a case to be made for having this area included in legislation. I wonder why it is necessary for collector credit people to be bound by the confidentiality clause while other financial institutions are allowed to run rampant through the records for a fee.

Mr. Mr. McDowell

Could the Minister come back to this on Report Stage?

Mrs. O'Rourke

I certainly will.

Question put and agreed to.

Section 86 agreed to.