News & Events

Data Protection Commissioner Warns Mortgage Intermediaries

30 January 2007

The Data Protection Commissioner announced on 21 December 2006 that he was issuing a guidance note to mortgage intermediaries nationwide.

This announcement followed investigations launched subsequent to RTA’s Prime Time programme of 12 December which made allegations that mortgage intermediaries were breaching the Irish Data Protection Acts 1988 and 2003. Prime Time’s undercover reporter had claimed that some brokers disclosed details of their clients’ financial information, including mortgage limits, to estate agents offering to sell property to those clients. Allegedly, the agents then used the knowledge of the potential buyer’s mortgage limits to raise the offer price of the property.

In his guidance note, the Commissioner noted that the Prime Time programme and the Office of the Data Protection Commissioner’s investigations had “highlighted a sectoral lack of awareness amongst mortgage brokers in relation to the full extent of their responsibilities under the Acts.” The guidance note re-iterates the eight fundamental rules of data protection, stressing that the principle that use and disclosure of data should only be made in ways compatible with the specified, explicit and lawful purposes for which they are obtained is of “great significance” in relation to mortgage intermediaries.

The Commissioner further emphasised that where financial information was given by an individual to a mortgage intermediary for the sole purpose of obtaining a mortgage, the obligation fell on the intermediary to ensure such information remained confidential.

The Commissioner advised that, in the future, mortgage brokers should take “a transparent and balanced approach in collecting and using personal data”. Significantly, the guidance note stresses that there should be a clearly assigned data protection compliance function within mortgage brokerage firms and clearly defined rules about the use of personal data. The Commissioner also advised the Financial Regulator of the content of the guidance note.

The Commissioner warned that the programme of random inspections of mortgage brokers would continue.