Mortgage administrator/broker should have confirmed consent prior to issuing letter of interest for mortgage financing in couple’s name

PIPEDA Case Summary # 2012-011


[Principles 4.1.4 and 4.3]

October 12, 2012

A woman complained to our Office that a mortgage administrator/broker had collected, used and disclosed her and her husband’s personal information without their knowledge and consent.

The complaint stemmed from a personal dispute that led to court proceedings with the complainant and her husband as plaintiffs. 

The defendant in the proceedings was the spouse of a mortgage agent who had asked the administrator/broker (the respondent in this investigation) to prepare a letter of interest for mortgage financing in the name of the complainant and her husband, and to provide it to him. The financing was purportedly to build a new home on a property. The mortgage agent, however, was not actually a party to the court proceedings.

In requesting the letter of interest for mortgage financing, the mortgage agent provided information about the couple – including information that had been taken from a sworn affidavit filed in the ongoing court proceeding.

The administrator/broker said he assumed the information had been provided to him with the consent of the complainant and her husband for the purpose of applying for financing.

He prepared the letter of interest for mortgage financing in the name of the complainant and her husband, and included some of the information originally provided by the mortgage agent. He then gave the letter to the agent.

The complainant and her husband told our Office that they had never requested the letter of interest for mortgage financing, only becoming aware of its existence when, months after it was prepared, the letter was introduced as evidence in the ongoing court proceeding. (The affidavit containing information about the couple subsequently used by the agent had been filed in the same proceeding.)

The financing of the property referred to in that letter was at issue in the proceeding.

The complainant is of the opinion that the material filed as evidence as a result of the agent’s request for the letter, was false and that it was detrimental to their case.

The administrator/broker told our Office that he had accepted the information from the mortgage agent in good faith and was not aware that the information had been obtained from public records.  Even so, he asserted that, given the information was available from public records, he did not consider it to be “confidential” or “private,” and it was therefore exempt from requiring consent under PIPEDA. 

At issue was whether the administrator/broker collected, used and disclosed the personal information of the complainant and her husband without their knowledge and consent.

The Assistant Commissioner found that, in preparing and issuing the letter, the administrator/broker collected, used and disclosed the couple’s personal information without their knowledge or consent.

She also determined that, although some of the information that was collected by the administrator/broker appeared in a record of court proceeding, such information did not fall under the exception for obtaining consent where the information is publicly available and specified by the regulations under the Act. 

PIPEDA’s regulations specify that publicly available personal information is that which appears in a record or document of a judicial or quasi-judicial body that is available to the public, where the collection, use and disclosure of the personal information relate directly to the purpose for which the information appears in the record or document.

In this case, the Assistant Commissioner found that the collection of personal information by the administrator/broker did not relate directly to the purpose for which the information appeared in the court record. 

The purpose of the personal information which appeared in the court record was to provide evidence in an ongoing legal proceeding..

The purpose for which the administrator/broker collected, used and disclosed the personal information was to propose a financial arrangement for a loan.

Those two purposes were clearly not related.

In order to prevent any recurrence of a similar situation, our Office recommended that the administrator/broker establish a procedure to obtain consent for the collection, use and disclosure of personal information, and inform our Office of how it would implement the procedure. 

The administrator/broker established a new procedure ensuring that, before collecting, using or disclosing personal information in the future, it would: i) obtain consent directly from the individual, or, in situations where personal information is obtained from a third party, ii) examine the suitability of any pre-existing consent.  As well, the organization provided employee training for the new procedure, and developed associated material.

Accordingly, the complaint was deemed well-founded and resolved

Lessons Learned

  • Collecting, using or disclosing an individual’s personal information requires the knowledge and consent of that individual (unless a specific PIPEDA exception applies); organizations need to satisfy themselves that the appropriate form of consent has been obtained in light of the circumstances. 
  • The exception from obtaining knowledge and consent where the information is publicly available in a record or document of a judicial or quasi-judicial body only applies where the collection, use and disclosure of the personal information relates directly to the purpose for which the information appears in the publicly available record or document.
  • Organizations must implement policies and practices to give effect to the principles of PIPEDA.
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