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US stock market daily report (June 16, 2014, Monday)

June 17, 2014, Tuesday, 06:11 GMT | 01:11 EST | 10:41 IST | 13:11 SGT
Contributed by Millennium Traders


Federal law requires credit reporting agencies to conduct a free, reasonable investigation when consumers complain or dispute something on their credit report. Credit reporting agencies are 'for profit' and when they see a way to generate more revenue for their company, they will seize that opportunity. According to study by the Federal Trade Commission, 5% of all consumers' credit reports contain errors that could harm their ability to obtain credit.

Lets talk Experian (EXPN-LON) - the largest credit reporting agency with revenues of $4.8 billion in 2013 - who faces a lawsuit filed against them in a federal court in Mississippi. The suit by the state of Mississippi alleges that Experian knowingly included error-riddled data in the credit files of millions of Americans and routine violations of consumer protection laws. The errors by Experian jeopardize these same Americans the ability to obtain loans at interest rates equivalent to their accurate credit score or prohibits them from getting a loan, period. The same errors not resolved by the credit agency giant affects employment-related background checks, government security clearances and even wrongly reports certain consumers as being on a federal terrorism watch list - when in fact they are not. Mississippi claims that while Experian collects various amounts of data to build consumers credit files and it is common practice for consumers to see less information than what is provided to potential creditors and banks. Consumers are required to receive same information from credit reporting agencies, as the agencies provide to potential creditors. Without access to their full credit report, consumers remain clueless as to potentially inaccurate information that affects their credit worthiness.

Jim Hood, Mississippi Democratic Attorney General leads the lawsuit against Experian. Per the lawsuit, Mississippi says that when consumers file a dispute with Experian, the firm reflexively finds and rules in favor of the bank or debt collector that reported the debt. Experian provides no straightforward way for consumers to correct erroneous blemishes affecting their credit. The lawsuit said that, when consumers call to complain, Experian employees try to sell them credit monitoring products of questionable value. In a statement Hood said, "Experian has turned its failures to maintain accurate credit reports and its refusal to investigate consumer disputes into a business opportunity."

In the lawsuit which alleges the firms misconduct harmed Mississippi consumers, per interviews with former Experian employees as well as documents obtained from Experian, "Experian fails to conduct any, let alone a reasonable, reinvestigation of consumer disputes regarding their credit history or accounts."

Consumers have been wrongfully hounded for debt they did not owe, prevented from taking out loans and threatened with the loss of top secret military clearances because of Experian's alleged failure to maintain reasonable procedures to verify credit information and correct mistakes which is a violation of the federal Fair Credit Reporting Act.

Other Experian errors consist of a credit file that wrongly stated that a Mississippi resident, described in the complaint as "Consumer 5" was dead, which proved to be nearly impossible to fix. The complaint reads, "At first, Consumer 5 and his wife thought it was funny." Months later, unsuccessful efforts to fix the error by Experian cost them the ability to purchase a truck at a favorable interest rate.

The Mississippi complaint includes details of a lieutenant colonel in the Army National Guard who was denied credit and forced to buy numerous credit monitoring services due to Experian's failure to distinguish between his credit history and those of other persons in his family.

There appears to be numerous unreported multi-state led investigations against credit reporting agencies. During 2013 in a lawsuit against Equifax Inc. (EFX-NYSE), a woman from Oregon won a jury verdict of $18.6 million.