A legal dispute resulted in the bank using a private eye to access a customer’s credit rating file – and he wants to know why

If you were embroiled in a dispute with your bank, how would you feel if you discovered that, unbeknown to you, private detectives had accessed your credit report to get the lowdown on your finances?

Perhaps you would be shocked and consider it a breach of your privacy, as there are tight controls on who can carry out a search of your credit report – it can only be done with your permission. Or maybe you wouldn’t be particularly surprised, on the basis that it’s not unheard of for private investigators to get involved when two sides are locked in a dispute.

Last year Gary Gadston was immersed in a legal battle with NatWest over a property deal (the case later went to court and a settlement was reached in November). He decided to request a copy of his Experian credit report to check there was nothing nasty lurking there that he needed to know about.

experianOn receiving it, he was delighted to see that his credit score was the maximum 999 – but less delighted to see that a search of his file had been made in May last year by a company he had never heard of, Hogan & Co.

No information was provided about who this firm was and why it was looking at his personal credit file, and a call to Experian shed little light.

So Gadston googled Hogan & Co, and found it was a firm of private investigators, based in Surrey and trading as Hogan International, that offered services ranging from fraud probes to surveillance. According to press reports, the firm was hired to interview some of the witnesses in the Madeleine McCann case, and also investigated one of the 7/7 suicide bombers before the attacks in London in 2005 and after the man’s bank became suspicious of his spending patterns.

Gadston, 55, contacted Hogan International to find out more, saying that a search of a credit report required the individual’s consent, “and I am unaware of any such consent being given”.

He received a letter from the firm saying the search was carried out in its capacity as “agents acting on behalf of Royal Bank of Scotland“.

Gadston’s lawyers wrote to RBS’s lawyers to say that the search had been carried out without Gadston’s prior knowledge or consent, and that he viewed this as a “serious” breach of his privacy.

In its reply RBS’s law firm, Shoosmiths, didn’t provide any clear explanation as to why Hogan International was involved; instead, the letter said it was legitimate for the bank to commission a search of Experian’s database in order to consider things such as the costs that would be incurred in going ahead with a court case, and possible settlement options.

Shoosmiths also claimed Gadston had previously given consent to NatWest and the RBS group by signing bank documents back in 2006 that made clear how it used credit reference agencies. But Gadston, who lives in Hemel Hempstead, Hertfordshire, claims these “financial profile” documents contained forged signatures and therefore could not be relied on.

This is one of the central aspects of the case, and Gadston appears to have an important ally in local MP Mike Penning. In October last year Penning wrote to RBS chairman Sir Philip Hampton to say that he had examined copies of the documents himself and agreed with Gadston that they “contain false information and signatures that purport to be of my constituents, when in fact they bear no resemblance”.

However, the bank replied to say that “the matter is now considered by all involved to be closed”.

When it was asked about the signatures back in 2011, Shoosmiths said in a letter to Gadston’s solicitors that “my client [ie, NatWest] can not explain why these signatures bear no resemblance to your client’s”.

We may never know the truth about the alleged forged signatures, or about how RBS justifies involving private investigators in such cases (does it hire them in many disputes? How much does the largely state-owned bank pay Hogan International?). Gadston says he has never received a proper explanation about either issue.

The legal case – involving a row over a property deal – has now been settled after five days in court. Gadston says NatWest had wanted to repossess his property, and that he and his wife Loraine had been defending the case on the grounds of misrepresentation.

In a statement, RBS said: “In common with other financial institutions, we occasionally use agents to provide financial status reports on customers with whom the group are involved in litigation.

This is part of an information-gathering process. As part of the group’s standard terms and conditions, it reserves the right to make periodic searches with credit reference agencies.”

Hogan International did not respond to our request for a comment.

Who is entitled to look at your file?

So, can anyone search your credit report? “No, searches can only be made with your consent,” says Experian. “This is usually given at the time you apply to a lender.” It adds that whenever someone accesses your information on its database, a search record, or “footprint”, is created showing which companies have searched your report and when. It is kept on record for a year.

In Gadston’s case, the Hogan & Co search was an “unrecorded inquiry”. Experian says this is “a search which has not been made as the result of a credit application, but reflects that the company has searched your report for other purposes – for example, to conduct an ID check”. It adds that this type of search isn’t seen by other providers of credit when they search your report, and doesn’t affect your credit score.

An Experian spokesman told us: “The credit account records that lenders share through credit reference agencies, such as information about loans and credit cards, are subject to very tight regulatory and industry rules … Other non-creditor organisations, such as the type highlighted in this case, would only be able to access the ‘public information’, such as court judgments and insolvency records. They would not be able to see someone’s credit account records.”No 9

The Guardian   


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