Using information from credit reference agencies such as Experian, Equifax and Callcredit that is "publicly available" and is "already used by commercial organisations" sounds an innocuous route to catch benefit cheats. But calling in these agencies – especially on a "bounty basis" – raises questions of which accuracy, accountability and access are just three.

My journalistic experience with data mining and how it is used in credit applications or sending in debt collectors strongly suggests that their systems are far from reliable. If your name is Mary Davies or John Smith and you claim benefits, then watch out. The more usual your moniker, the more you risk being confused with someone else of the same name.

Forty years ago, in my short and far from brilliant teaching career, I faced a class of south Wales boys where one in three was a Jones, and half of those was a Ken Jones. They found it funny when a Ken Jones at the back of the class substituted himself for a Ken Jones at the front. They would not find this confusion so funny now if it meant their benefits were stopped because another Ken Jones in a nearby postcode enjoyed an extravagant lifestyle, legitimately or otherwise.

The system works on people staying in one definable place. Moving around a lot – and many claimants have to do this – automatically creates negative credit-rating marks. Sometimes people are deemed not to exist (and therefore likely cheats) because the Post Office changed their postcodes and the rating agency failed to update them.

Information can be correct but is often incomplete. Two years ago, I sent £2 to each of the three agencies to see what information they held on me. Each one was different – none was complete. The reference agencies already hold amazing power over our everyday lives, splitting the population into rating-haves and rating-havenots.

If you spend all your life without credit – that's still not a crime – then you won't have a rating. And no rating is not just zero, it's a huge minus. There is also a race element to this. Asian areas typically get poor ratings because their culture eschews credit. Even a £10-a-month mobile phone contract depends on a positive rating.

But the agencies are not accountable for errors such as people being wrongly harassed by debt collectors or unfairly refused credit. It's a Kafkaesque world where the credit agencies absolve themselves of responsibility for their material, saying it is how the banks and other organisations use it that counts – and that's beyond their control. Question the banks, however, and they say they have no option other than to follow the information from the credit reference agencies. So it is beyond their control as well.

Access to your information is limited to that £2 search. You won't know what the information is used for, or any underlying assumptions on which it is based. Two pounds might not seem much to some; to those on benefits, it can mean a lot.

Commercial users now pay for information databases on a monthly basis or for each use. Payment by results will be different, offering an incentive to trap benefit claimants. It is hard to imagine a 100% clean bill of health will be seen as a success.

Other questions spring to mind. What will be the right of appeal? Will those who work for claimants have an easy route to question material or will they run into a "data protection" wall? Will the success criteria be made public or remain hidden behind "commercial confidentiality"? Will small-scale cheats really be picked up by systems designed to check mortgage and credit-card eligibility? And do serious benefit cheats – a tiny minority – really live in a world monitored by Experian rather than in the throwaway mobile, cash economy?