Brian Downey almost lost his home after credit checks

Unauthorized credit checks almost cost Brian Downey his dream home. (CBC)

Bell TV says credit checks on customers are “standard procedure,” despite concerns it could damage people’s credit ratings.

A Nova Scotia man won a $21,000 case against Bell TV this week because the company checked his credit without his permission.

“Credit checks protect customers from identity theft and companies from fraud and they’re standard procedure for most service providers, including Bell,” spokesman Albert Lee said Friday.  

He said in the case of Rabi Chitrakar, the man who successfully sued Bell TV, the policy was unclear to the customer.

“After he brought this to our attention, we apologized and retroactively waived all fees and contract obligations. When we hear about incidents like this from customers, we work to ensure that processes are well understood by our service representatives,” Lee said.

Justice Michael Phelan of the Federal Court of Canada called Bell TV’s conduct “reprehensible” and said they’d give Chitrakar the “royal runaround.”

'A warning sign'

Lawyer Mike Dull said Chitrakar’s case may have set a precedent. “What this decision does is serve as a warning sign to Bell and others,” he said.

“If there's anyone else that's the victim of unauthorized credit check be it from Bell or other companies, arguably they would be awarded the same damages.”

He said the landmark decision could change practices.

“If Bell does have a common practice then there are certainly others out there. This award, times all those others, would have the impact of modifying behaviour,” he said.

Audrey Wamboldt, a mortgage broker, said unauthorized credit checks happen regularly.

"Once in every five or six clients I'll see credit inquiries on their credit bureaus that have been unauthorized," she said.

Bell TV did not say if the standard credit checks were authorized or unauthorized.

Credit ratings are lowered if the person has had too many checks, regardless of their actual borrowing and repaying record.

Checks put man's home at risk

Brian Downey wanted to buy a bigger home for his growing family last year. The contractor thought he had good credit, but the mortgage deal almost went down the drain.

He discovered one of the banks had pulled his record four times. He’d given them permission to do it once.

The multiple inquiries deducted points from his credit score. His rating became so low he was considered a mortgage risk.  

“It felt a lot like begging. I was vulnerable,” Downey said. “It was terrifying. I was scared because we had a deal in place to sell our other house. Essentially we may have been homeless.”

He managed to salvage his mortgage deal.