CIFAS, or the Credit Industry Fraud Avoidance System, is a not-for-profit organisation to which banks and other financial institutions such as insurance companies are members.
CIFAS manages the largest database of fraudulent conduct in the UK. Member organisations report, or load, information onto the database where it is suspected that a customer has been involved with fraudulent activity or they present an unacceptable risk to its business. Those reports are known as markers and act as a warning to other financial institutions that the customer in question presents a risk, and provides in broad detail through a code system the nature of that risk.
The aim of the database is to reduce fraud risk in the financial services sector by sharing information on customers. Once a CIFAS marker has been highlighted applications for credit or other financial services may be subject to further checks and thereafter may be refused.
Unless you have been the victim of a fraud the existence of such markers is not shown on credit reports generated by organisations such as Experian, and many customers may be blissfully unaware that they have had them marked against their credit history.
Such markers become an issue for customers when applications for credit are made, such as on mortgage applications, car finance or for insurance products, and when applications are made for overdrafts or new banking facilities. Where financial institutions become so concerned about activity reported on accounts they can decide to close them even if those accounts are unconnected.
Frequently CIFAS markers can have adverse effects on entire businesses and, where directors have had markers loaded against them, we have seen many instances where Bounce Back Loans or other forms of lending have been refused and accounts closed.
For those employed in the financial service sector then CIFAS markers can have a dramatic and negative impact on careers and, because such organisations regularly check staff credit profiles, we have successfully acted for many individuals sacked as a result of markers being present. Markers can also prevent applicants being offered positions.
CIFAS markers can affect Student Loan Applications too – the Student Loan Company Ltd is a member of CIFAS and unless students have bank accounts they cannot receive their money.
In order to ascertain whether you have such a marker registered against you then you need to make a Data Subject Access Request to CIFAS https://www.cifas.org.uk/contact-us/subject-access-request/subject-access-request-form which will then produce a report outlining the nature of the markers and the organisations that have loaded it.