/ Money, Technology

What if your Facebook profile could influence credit decisions?

It’s been reported that Germany’s biggest credit agency is planning to trawl its customers’ social network accounts to gather information to help them credit check and identify ‘opportunities’. But could it happen here?

Surely it can’t be right that firms such as Schufa in Germany will be able to use information posted on social networks as part of the checks they run on people who want to purchase goods or services from other companies? It’s certainly not something I’d willingly consent to.

I think we’re potentially one step away from UK firms following suit. And I wouldn’t be impressed if it led to firms developing strategies to use our social networking information for their own means. That’s not what I signed up for.

Will the UK follow suit?

Should Schufa’s lead be followed in the UK, it could cause all sorts of privacy law problems. While you may agree that consumers generally expect their information to be shared between banks and credit reference agencies, it’s a different proposition altogether when you find out that your Facebook profile could be used to influence decisions on whether you’ll be offered credit or not.

Your photos, posts, likes and dislikes are arguably unreliable, irrelevant and definitely not uploaded with the expectation of such uses. On my reading of the Data Protection Act, I’d say this proposition is ‘prejudicial to the rights and freedoms or legitimate interests of the individual’. Admittedly, it’s difficult to provide a definitive answer, given the fact that the law on this point is not crystal clear.

Big Brother is bothering you

Germany’s consumer protection minister, Ilse Aigner, is so concerned that she has said the practices being planned by Schufa are akin to something you’d expect from a Big Brother state. On the other hand, businesses will probably argue that the information they’re sifting though is publicly available, so they’re doing nothing wrong.

But this seems to be an argument based on the fact that privacy laws are always playing catch-up to fast developing technologies. It seems we may live in an age of surveillance, which might be leading us to develop paranoid tendencies. But until it’s made clear how companies can use our information and what they can use it for, maybe we should all put a bit more thought into the information we post online and the privacy controls we use.

Comments
Guest
John Symons says:
12 June 2012

Frankly if you put claims of reckless spending and borrowing on a social network you are a fool. if potential employers now trawl social networks, why would not potential lenders?

Guest

Good point, I don’t think many people do put that sort of info up. But if banks are allowed to trawl your info, it will be automated rather than just people reading your status “Oh no, defaulted on a loan, oops!”

I think they’re thinking more of, for example, crawling peripheral information such as whether you’re in a relationship, whether you change jobs regularly, etc.

Guest

Which? Conversation has convinced me that Facebook and its popularity are big issues for modern society. Look at Wikipedia and the page on Facebook criticism has more content than the page on Facebook itself.

It is hardly surprising that companies wanting to be successful will make use of information available online.

Keep on identifying the problems and let everyone know, until Facebook et al. are properly regulated or become unfashionable.

Guest

If they covertly use sources which can be either hijacked, wrong or subject to abuse then there are clearly issues. Any decisions need to be transparent and subject to review with clearly ring fenced consent required for information used.

Guest

Businesses here have been doing this via clubcards, reward cards, etc, for years now.
How many readers of this forum use microsoft office? Newer versions, ie, office 2010, already feedback information to business, google and hotmail do it, then sell it on for big profits.
Our own government are in the process of changing the law around information to be able to share information on government files with certain businesses.

As for effecting the prices we all pay, we have little control as legislation, successive governments, regulators and enforcement bodies all ignore pleas from the public, who are deemed to be “conspiracy theorists,” for some protection.

Car insurance is no longer priced based upon the car you have, crime in your area, etc. Now we are priced based on the percentage of owners that have had a crash who drive the same car, your job description (manual worker, company director, etc.)
Public are not given clear breakdowns on price, just head office dictats, because the insurance companies have lost pots of money trying to make quick profits in the markets and with pension funds, etc. (Don’t get me started on charging us to pay over 12 months, then giving themselves the fees for doing so!)
Bank charges are based solely on the amount of money the bank lost in the previous financial year, divided by the number of charges they issued, to work out an average price to recover the money, nothing to do with how much the individual actually cost the bank with their account. This is illegal, yet those in power and on the taxpayer gravy train (read: quango regulators) do nothing.
Even supermarket prices are down to demographics, monitoring everything from where we walk in their stores to jobs/property prices in the area of each store, from earnings in any given area of the country to analysing credit/debit cards used to pay for goods in their stores.

This is part of the problem – companies tell us “we never sell your data on to any other companies” – which isn’t strictly true.
Businesses can legally sell on “analysis” of any data they want to collect.
It matters not if this data comes from your credit/debit card, job descriptions, value of homes in the area or how many people bought a packet of andrex on a tuesday afternoon, they sell it to each other, it’s an industry on it’s own and a very profitable one at that!
All social networking information will do is add another string to the bow of business to be used to fire financial arrows at everyone, putting more holes in our pockets for our money to fall through into their troughs.

Legislation/laws do not keep pace with businesses, you are correct.
With governments, regulators, enforcement bodies all funded by businesses and dancing to their tune, there is no impartiality to protect the public.
Where is all our information being stored?
The law used to safeguard us by stopping all our information from being stored on countries without our strict terms of data protection enforcement – the last government changed the law so that banks could move out call centres to places such as India, who still to this day do not have data protection laws matching the UK.
Whilst information is stored abroad, analysis of it can be made and that analysis can be sold on. We can’t even keep businesses in check with our info in the UK, god only knows what they are doing with it when it’s abroad?

The only way to protect yourself from it, as far as it’s possible, is to be as anonymous as possible when online.
Why else do people believe that only real names are facebook’s terms?
Every advert on TV wants you to join a facebook group, for shampoo or fruit drinks?
Supermarkets will match the prices of rivals, providing you enter name address email address, etc. Then people give them all their shopping habit information so they can target prices for maximum profit and make far more back than the offered “£5 off your next shop” or “double card points”

If the government today ordered all UK trading companies to open up and reveal what they are doing with information and which other companies “analysis” of our information is being sold on to/shared with, people would be outraged and rightly so.

The public do not stand a chance.

Guest

I guess the issue is that as much as technology has made it easier for us all to connect with one another, the companies behind all this aren’t acting out of the goodness of their heart. They have their agenda. I still think that social networking is a good thing, just advise a little caution about how it’s used. As frugal ways says, it’s probably best to be as anonymous as possible – even if that does kind of defeat the purpose of most social networks. It’ll be interesting to see what happens when/if anyone takes a company to court on this.

Guest

@frugal ways.
I read your post then I look out at our ‘summer’ weather and am hit by an overwhelming sense of despair, and worse, I know you have only brushed the tip of the iceberg.
I for one do not use Facebook or twitter, I have no interest in ‘social media’ and can find no use for it. I wonder if soon the fact I don’t have a Facebook account will count against me.
Right now if you do not have a debit or credit card and mobile phone there are areas you cannot park your car [pay by phone]. So you are penalised for not ‘opting in’, is this the next step either comply with general trends or be excluded.

Guest

Well said, m.

I am not opposed to change but sometimes change may not be for the better. If I have a problem I want to contact a company by email, which allows me to keep a copy of correspondence and attach photos. I don’t want to use a web-based form. I certainly don’t want to use Twitter, so next time Which? promotes it I might be rather rude. Many smartphones need to be charged daily, so someone with a flat battery would also be unable to park in areas where payment is by phone. Apple produces some fantastic products but an iPhone is little better than a Fisher Price toy in my opinion, simply because the user cannot pop in a fresh battery. People are trying to phase out the cheque book when there are situations when it is the only practical alternative.

I want to see Facebook etc. fail. I’m not worried about Twitter, but I certainly don’t want to be forced to use it.