If you have applied for credit, either as an individual or a business, you may have encountered CIFAS markers or bank fraud markers. They can make it harder to get credit, which can be a hugely frustrating experience. If CIFAS markers are affecting you or your business, there are some steps you can take. The guide outlines some of the most common questions about CIFAS markers to help give you peace of mind and show you the potential ways forward.
CIFAS markers explained: Quick Links
- What is CIFAS?
- What are CIFAS markers?
- How do I know if I have a CIFAS marker?
- How can CIFAS markers affect me?
- Why do CIFAS markers make it harder to get credit?
- What are the different types of markers?
- How can CIFAS markers be removed?
- Are there any other databases for bank fraud markers?
- How Setfords can help with marker removal
What is CIFAS?
CIFAS stands for “Credit Industry Fraud Avoidance System”. It’s a not-for-profit fraud prevention membership organisation that manages an extensive database containing details of fraudulent conduct in the UK.
CIFAS aims to reduce fraud and crime. Members come from various sectors and include the vast majority of financial institutions, who use it to report and access data about potential fraud.
What are CIFAS markers?
CIFAS markers, otherwise known as bank fraud markers, are placed against customers credit reports when a financial institution, such as a bank, insurer, or loan company, considers that you or your business have been involved in a financial crime. Other institutions can then access this marker to gain more information about you and the potential risks of lending to you.
How do I know if I have a CIFAS marker?
Many people who have a CIFAS marker are unaware of it until they apply for some form of credit and are rejected.
If you have a CIFAS marker because you have been the victim of fraud, you will be able to find a record of it on your credit report. But, unless you have one of two types of marker (Victim of Impersonation or Protective Registration), the only way to find out about it is by making a Data Subject Access Request to CIFAS itself. This is because the financial institution that placed the marker on you in the first place has no legal obligation to inform you about it or why it is there.
How can CIFAS markers affect me?
Having a CIFAS marker against you can have several negative impacts, including:
- The most common impact is that you will struggle to get credit accepted, such as a mortgage, car finance, overdraft, mobile phone contract or insurance product. Your application will likely have to go through extra checks, and you may still be denied.
- If financial institutions become concerned about activities on any of your accounts, they may decide to close your accounts, even if those particular accounts are not affected.
- If you apply for a new bank account, the application is likely to be declined.
- A marker may also affect your application for student loans through the Student Loans Company, a member of CIFAS because you will need a bank account in order to apply for a Student Loan.
- If you are employed in the financial services sector, a CIFAS marker could negatively impact your career or result in future job applications being rejected.
- If a business’s directors have markers against them, the company may be refused loans or other forms of credit and banking facilities.
This list is not exhaustive, and there are many ways in which a CIFAS marker may affect you or your business. If you’ve been affected, get in touch with us today to discuss your options.
Why do CIFAS markers make it harder to get credit?
Consultants at Setfords choose a more flexible, balanced and rewarding Lots of credit applications are automatically checked. For example, when applying for a store credit card, car finance, or even a personal loan. If a CIFAS marker is filed against you, this automatic process cannot go ahead, and your application will have to be subject to further checks.
Furthermore, financial institutions may be more reluctant to lend to those with a CIFAS marker because of their previous history.
What are the different types of markers?
There are eight types of CIFAS markers. Each one represents something different, and they last for different amounts of time. They are as follows:
- Protective Registration. This is a marker that you can pay for directly to CIFAS or a third-party provider, if you believe you have been a victim of fraud. It lasts for two years.
- Victim of Impersonation. This is a marker filed by a lender for your protection if you have been a victim of identity fraud. It lasts for 13 months.
- First-party fraud. This can be filed when there is no intent to repay promised future repayment for exchanging goods and/or services. It can last up to six years.
- Facility Takeover. This marker is filed when a bank account is taken over and used for unauthorised transactions, lasting for up to six years.
- Misuse of facility. This occurs when an account is obtained with the intent to use it for fraud. It lasts for up to six years.
- Asset conversion. This marker can be filed when an individual sells goods that they do not own, for example, a car, under a hire purchase, conditional sale, contract hire, leasing or rental agreement. It can last on your file for up to six years.
- Application fraud. This happens when an application for credit is made using an individual’s real name but false details such as employment, salary, address, or falsified documents. It can last for up to six years.
- Insurance claims fraud. When incorrect information is provided when seeking a monetary insurance claim, this marker may be filed, lasting for up to six years.
How can CIFAS markers be removed?
Having a CIFAS marker placed on you by a financial institution can be hugely inconvenient. However, it is possible to have them removed in some cases before the time has elapsed.
CIFAS marker removal can be challenging, involving complex areas of law. So, before you begin the process, it is always best to seek legal advice from a solicitor who is an expert in this area. They will be able to advise you on whether removing your marker is likely to be possible and the steps you will need to undertake to do so.
The first step is normally to obtain a report from CIFAS detailing the information about your marker. This will show you what has been alleged against you, and by whom. From there, you can attempt to gain more information from the financial institution that filed the marker, although they are under no legal obligation to provide you with anything beyond your bank statements.
You and your solicitor can then make a challenge to the financial institution directly. You will likely have to prove why the marker should be removed; simply stating that it has been unfairly filed is not enough.
The financial institution will then issue its final response. If they do not agree to remove the marker, you can directly challenge CIFAS, who must respond within 14 days.
From there, if CIFAS also refuse to remove it, a complaint can be made to the relevant ombudsman or similar service. This is usually the Financial Ombudsman Service for banks, or the Communications and Internet Services Adjudication Scheme for mobile phones.
If this still fails in your quest for CIFAS marker removal, in a small number of circumstances, it may be possible to challenge the decision by way of judicial review or injunction. Your solicitor will advise you if this is possible and the steps that need to be taken.
Are there any other databases or bank fraud markers?
There are two other similar databases in the UK, although they hold more limited information about an individual. These are SIRA and National Hunter. Both of these databases can supply data to financial institutions and judge whether an individual’s status is ‘clear’ or ‘refer’. National Hunter also uses ‘inconsistency’ and ‘suspicious’ judgements on concerns surrounding an individual’s account activity.
In some cases, you may be able to challenge these databases in the same way as you would challenge a CIFAS marker. Your solicitor will b able to give you further advice on this.
How Setfords can help with marker removal
If you believe you have had a CIFAS marker unfairly filed against you or your business and have valid grounds to challenge it, Setfords can help. We have solicitors who are highly experienced in this area and can help you come to a resolution. Please don’t hesitate to get in touch with us today to discuss your situation and how we may assist you.