Last night's 60 Minutes featured a 13-minute expose on the unbelievable frequency of mistakes made by the Big Three credit reporting agencies (Equifax, Experian, and TransUnion), and the utter hopelessness faced by affected folks who try to correct them.
"Whether we like it or not, we live in an age where much of what goes on in our daily lives in monitored, collected, and sold to interested parties," the report begins. The results of the investigation are unsurprising to those with intimate knowledge of the credit reporting industry: nearly 40 million Americans have a mistake on their credit report, and 20 million of those with mistakes are measurably affected by them. What's most alarming is that these mistakes are often impossible to correct.
Take the "dispute process" required by the Fair Credit Reporting Act, a federal law which supposes to provide a modicum of regulatory oversight to an otherwise unregulated industry, as the consumate example of the industry's failure to accurately represent the people on whom it distributes information for money. When a person disputes information on their credit report, the law requires credit reporting agencies to "conduct a reasonable reinvestigation to determine whether the dispute information is inaccurate . . . ." As 60 Minutes discovered, the credit reporting agencies do not actually investigate at all-- the expose features this exchange with a team of former Experian investigators:
"If somebody had a problem with their credit report, they would send in a complaint and it would end up with you?"
In fact, all the "investigators" do is read a dispute, reduce it to a 2-word code like 'never late' or 'wrong person,' and send the two words back to the creditor without documentation. Seems insufficient? Says attorney Leonard Bennett, a consumer advocate from Virginia: "I can say this without qualification: the dispute procedures uniformly used by the credit reporting agencies completely fail to comply with the Fair Credit Reporting Act. Courts have found that, the Federal Trade Commission has found that. It's not even a close call."
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