Business ethics continue to plummet and plummet in a dark pit of its own making.
Just as we came up to breathe over the various corporate wrongdoings, from Libor to PPI and everything in between, along comes bogus legal letters sent out by some of the most reputable firms, including a public sector body, with the sole intention of intimidating clients in to a fear of reputational damage.
We have said here before, and say again, that the credit reference agencies are the elephants in the room of financial services; their clients are the big commercial firms, who often use them in a vindictive way to get back at obstreperous clients and customers.
We have called for tighter regulation on these credit reference agencies, including putting a halt to the black marking of consumers for late payments and defaults without a proper process.
It is not unknown for some major firms, including utilities, to put damaging reports against customers’ names just for having the temerity to question an invoice or the quality of a service.
This corporate bullying then comes back to haunt the consumer when he or she applies for a loan and finds that credit reference agencies have recorded a credit black mark against their names.
For some lenders, of course, this is good business since it feeds in to the sub-prime and near-prime categories, giving lenders an excuse to raise repayment interest rates.
We only have to look back at the pre-Lehman Brothers period to see how the sub-prime market, both sides of the Atlantic, took off.
Without batting an eyelid, some people in the industry rushed for the moral high ground by blaming the very victims of unethical business practices for finding themselves in a financial trouble.
Of course, this is no justification for denying ordinary workers from accessing home ownership, it is simply a call for the City regulator to clamp down on credit reference agencies, and in particular their cosy relationship with their commercial clients, and, failing that, for the Treasury select committee to carry out a wide-ranging enquiry in to their operations.
