Credit bureau sent lenders inaccurate information, damaging consumer access to credit
Following news that credit reporting agency Equifax sent millions of letters containing inaccurate borrower credit scores to lenders, consumer advocacy group U.S. PIRG condemned the action and called for accountability.
The credit scores were sent to lenders for potential borrowers seeking mortgage loans, auto loans, and credit cards. A downward shift of up to 20 points, as indicated in the report of the incident, could have had detrimental impacts on credit decisions.
In a statement, U.S. PIRG noted Equifax's past errors with consumer data and said the agency must be held accountable.
“After losing our Social Security numbers in the worst data breach in history nearly five years ago, Equifax has shown once again that we can’t trust it to do its one job -- a job that Equifax and the other two national bureaus appointed themselves to do. We never asked them nor gave them permission to collect data on us or sell the credit scores derived from that data to lenders," said Mike Litt, consumer campaign director at U.S. PIRG.
Equifax Response Called "Outrageous"
“Equifax and the other two national credit bureaus serve as gatekeepers to much of the financial marketplace. Mistakes on credit scores can keep people from getting mortgages, good interest rates or even a job. Consumers have long reported problems with mistakes on their credit reports. Now they have to worry about whether their credit scores are incorrect even if their reports are correct.
“The Journal reported that the Equifax CEO said it’s ‘not something that’s meaningful to Equifax.’ That’s outrageous. Why isn’t he apologizing to the millions of consumers who might pay too much for credit or be denied credit? That impact will not ‘be quite small’ to those people."
U.S. PIRG said regulators and Congress must take action to protect consumers and prevent further abuse in the credit reporting industry.
“We’re calling on regulators to investigate Equifax to get to the bottom of these questions. Congress should also act to protect consumers and prod the credit bureaus to take data accuracy seriously by requiring them to pay hefty fines when they put people’s credit at risk," Litt added.