It was just 20 years ago that thousands of low profile “local” bureaus handled all the consumer credit records. Now, the data of 215 million Americans are controlled by the three remaining companies that gobbled up all these local bureaus.

Publicly traded Equifax, founded in 1898 by a Tennessee grocer who sold his customers’ payment records to other shopkeepers, now calls itself a “global leader in information solutions” with businesses as diverse as risk detection and database management. (According to its income statements, its consumer data unit remains its most profitable, boasting a 40 percent pretax profit margin.) The smallest, Chicago-based TransUnion, is owned by the Pritzker family who control the Hyatt hotel fortune and boasts credit-reporting operations in 25 countries. Experian, the largest of the three is a $4 billion company, based in Ireland, that uses consumer data to help businesses send more than 20 billion pieces of junk mail every year.

Together, the three credit bureaus have amassed a spotty record on consumer care. In 2000 they jointly paid a $2.5 million Federal Trade Commission fine for blocking millions of phone calls from consumers. Three years later Equifax paid a second fine because it still hadn’t hired enough people to answer the phone. In 2005, after new federal laws forced the bureaus to give away credit reports online, Experian was hit with a $950,000 FTC fine for marketing those reports through a Web site that automatically charged consumers for an $80 credit-monitoring service. Last year TransUnion agreed to pay $75 million to settle a class-action lawsuit over sales of consumer data for marketing purposes.

The bureaus, which never admitted wrongdoing in these cases do admit that credit-report errors can stem from glitches in their own systems. Some mistakes occur thanks to the algorithms used to match loans to individual credit reports. If the name or Social Security number on another person’s account partially matches the data on your file, the computer might attach it to your record.

Problems can happen in the gathering of tax lien and bankruptcy data due to the contractors employed that can transpose digits or misread documents they get from the courthouses and government offices.

But perhaps the scariest fact of all is the credit bureaus own admission that even if they never made mistakes of their own, they can’t possibly patrol the accuracy of the 3.5 billion pieces of account information they receive every month from lenders.

To put this in proper prospective, to help grasp the enormity of this system you’ll find three publicly traded companies, the smallest TransUnion generating 1.628 Billion in sales, Equifax generating 1.935 Billion in sales and Experian with a whooping 4.130 Billion in sales. The fining of Equifax $950,000 is like fining a person making $50,000 about $25, almost laughable! TransUnion getting hit $75 million is that same $50,000 being fined about $2303 more painful but hardly a deterrent to stop the sales practices they embrace.

The credit bureaus are looking for sales, sales of your most private information to other companies. They have neither the personnel or the policing systems in place to prevent errors, half truths and untruths to be told about you. The FTC is not active nor are they forceful enough to stop these abuses.

As all things in life it is the responsibility of you as the consumer to fight for your rights!

Be Bold!

Herschel

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