In a recent blog entry I wrote, ?Significant legislation has been enacted to protect you from the impact of the credit bureau's inaccuracies. The right that you have to receive copies of your three credit reports for free on an annual basis is not a friendly public service by the credit bureaus. The bureaus have been required to provide this service as one of the protective measures included in the Fair and Accurate Credit Transactions Act. Your credit report can have a major impact on your financial life. Give your credit the attention that it deserves and review your reports regularly.?
A Reader Responds
A reader responded by asking, ?I've read that the credit bureaus are regulated by the Federal Trade Commission. Doesn't this indicate a relationship with the government?? Below is my reply along with some additional thoughts on the subject.
The Credit Bureaus are Not Government Agencies
I replied that, ?The relationship between the credit bureaus and the government is the same as the relationship that you have with the government. Because your actions are conscripted by law does not in anyway suggest that you are necessarily a law abiding citizen (although I'm sure that you are!). As many people live in a constant adversarial relationship with the government, so do many large businesses. The credit bureaus happen to be constantly at odds with the law. Given the potential impact that credit reporting errors can have on your financial life, I strongly suggest that you modify your opinion of the bureaus enough to be very cautious of the content of your credit report.?
Strictly For Profit
One of the unfortunate underlying assumptions that people, like the above reader, have in their attitude towards the credit bureaus is that the bureaus have some form of official status. This could not be farther from the truth. They are strictly for profit businesses. Experian and Equifax are publicly traded companies and list their revenues in the billions of dollars. Trans Union is a privately held company with revenues estimated also in the billions. The three credit bureaus have maintained a consistently adversarial relationship with the government and consumers throughout their histories.
An Adversarial Relationship
An adversarial relationship with the public is not unusual for large businesses. All activities are chosen for the purpose of producing profits. The history of lawsuits brought against the bureaus over time paint a clear picture. The office of the Attorney General of Florida is currently pursuing action against Experian relating to misleading claims, deceptive advertising, a misleading domain name (freecreditreport.com), and failure to honor cancellations to their credit monitoring service offered through this so-called free credit report website.
A History of Conflict
The type of behavior described by the Office of the Attorney General of Florida is consistent with countless charges against the three bureaus. In the 1970s Equifax was charged with rewarding its employees for collecting negative information on consumers. This charge, which resulted in a consent decree, provides an interesting hint about the corporate culture.
Experian Gets an ?F?
In 2006 a leading consumer advocate website rated the customer service offered by the three bureaus. The ratings were dismal including a grade of ?F? given to Experian, who was sited for not even providing customers with a customer service telephone number. is not on the priority list at the credit bureaus!
Nothing Has Changed
The above mentioned consumer advocate site has a current post that says, ?With the 2003 amendments to the FCRA, and the introduction of the FACT Act, millions of consumers will see the quality of their credit reports degrade even further. FACT stands for Fair and Accurate Credit Transaction Act, but in reality it is just our government trying to appease millions of consumer who complain about the current credit reporting industry. But they are only appeasing us in name only??
The Forces at Work
We have been assisting our customers with since 1989 and as such have dealt with the three bureaus on a consistent basis. There are two major forces at work that shape the behavior of the credit bureaus. The first major force is the need to maximize and protect profits which may result in decisions about operating policy that are not in the best interest of the public. The second force that conspires with the profit motive is the sheer bulk of data that the credit bureaus are trying to manage and maintain. The result has been widespread and serious errors on consumer reports combined with a horrible corporate bureaucratic resistance to fixing the problem. So check your credit reports regularly.
Copyright ? 2007 James W. Kemish. All Content. All Rights Reserved.
Well, in my opinion the credit bureaus will not want you to know this information. Those companies and the big money banks working with them would like you to keep thinking what you think and believing what you believe. However, what you don't know can hurt you to the tune of a bunch of money. No one wants that.
Where credit bureaus are concerned, there are essentially two sets of "truths." On the one hand, there is the fairly meaningless happy patter they want you to believe, which you can find repeated in just about every credit-related book and Internet site. And then, of course, there's the real truth which I'll shortly elucidate.
So what are the current beliefs? The point of this message is to wipe away the accepted norm that has been created by our friends TransUnion, Equifax, and Experian. Let's get you back up to speed on the truth and save you some of your hard earned cash in the meantime.
Myth: There are three official credit bureaus, and these beloved and vital American institutions maintain accurate records regarding the financial lives of every adult citizen.
Where do I start? That myth is so riddled with falsehood I'm not sure what to tell you first. But I'll give it a go.
First, the so-called "big three" consumer reporting agencies with which most Americans are familiar ? Equifax, Experian, and TransUnion ? truly want consumers to believe that they've each been blessed with a sanctioned franchise. Actually, the only reason such corporate behemoths now dominate the landscape is because their progenitors simply managed to swallow up each other as they battled for preeminence through the decades. Greed, not official dictum, paved their way. Even if you didn't click the historical link in the previous sentence just now (and missed out on how, for example, the company which became Equifax once used Welcome Wagon ladies to spy for them), suffice to say there is hardly anything "beloved" about these privacy-busting companies.
You should also be aware of the fact there are some new bueaus working very hard to work they're way into the system and move the big boys aside, which would be to all of our betterment. Did you know anyone could start their own credit reporting company and greedily grab all kind of private information from the people around us? Then it gets better because now you sell this information to the highest bidder. There are laws that limit this, but no one can stop you from getting into the business in the first place.
So contrary to the prevailing perceptual reality, there are no official bureaus. And while most Americans perceive their credit reports to have at least the same legal standing as their driving records, the truth is that the government had no role in establishing the for-profit companies which produce them. Put bluntly, no law mandates a credit report's existence, and such documents deserve as much respect as "The Weekly World News" supermarket tabloid or any other similarly unproven list of allegations.
And also please don't believe these companies are worrying at night about how accurate your information is. Rumor has it that there have been several studies done showing many of our credit reports have errors in them.
Both Jim Kemish & Paul Johnson are contributors for EditorialToday. The above articles have been edited for relevancy and timeliness. All write-ups, reviews, tips and guides published by EditorialToday.com and its partners or affiliates are for informational purposes only. They should not be used for any legal or any other type of advice. We do not endorse any author, contributor, writer or article posted by our team.
Jim Kemish has sinced written about articles on various topics from College Student Loan, Credit Loans and Free Credit Report Score. Jim Kemish is the president and founder of Power Mortgage, a company based in Delray Beach, Florida. Power Mortgage Corp was established in 1989 and s. Jim Kemish's top article generates over 301000 views. to your Favourites.
Paul Johnson has sinced written about articles on various topics from Alcohol Treatment, Credit Cards and Credit Loans. An excellent free resource for your credit repair needs is online awaiting to help you. This site is owned and operated by Paul Johnson.. Paul Johnson's top article generates over 40500 views. to your Favourites.