Equifax, Experian and TransUnion await their asbestos moment

If you watch late-night television, you’re bound to see plenty of commercials for law firms soliciting clients for their big class-action suits involving asbestos and mesothelioma, or targeting those who’ve suffered side effects from a wide array of popular medicines.

I will take it as a sign that America is getting better when I start seeing ads like that going after Equifax, Experian and TransUnion.

Those are the big credit-rating agencies — the unelected, unaccountable Fourth Estate of American government.

The press used to be called the Fourth Estate, but they’re not doing enough to retain that title these days. And the truth is that the credit-rating agencies have more influence on more people’s lives every day than the press does at this point.

Equifax, Experian and TransUnion shake down individuals and they shake down corporations. Their business model is intrusive and meddlesome, and simply asserts its own right to power over everyone else. The lack of any specific law stating that they have no right to such power still doesn’t mean that we all ought to be yielding it to them so willingly.

The credit-rating agencies are also terrible at what they pretend to do. Their formulas are inadequate and the data they feed into those formulas is horribly flawed. It’s supposed to be flawed — that’s part of their business model.

Really — the credit ratings agencies produce inaccurate and unreliable “scores” by design. Better data fed into better formulas would mean there’d be a smaller market for the protection racket that fuels so much of their business. If they bothered to confirm the accuracy of any of the scores they’re slapping together, then there would be no reason for anyone else to subscribe to their lucrative “see a copy of your credit report” services.

It’s evil genius. The phrase “credit-rating agency” makes it sound like these agencies should be rating credit-worthiness, but they’re explicitly advertising that they can’t be bothered to do that. Instead, they will — for a monthly fee — allow those being rated to see copies of their reports, so that the people being rated can verify that the information is accurate.

Oh, and as Ylan Q. Mui’s long report for The Washington Post demonstrates: the credit-rating agencies are also really, really racist.

What ought to happen to Equifax, Experian and TransUnion is something like what eventually happens to the King and the Duke toward the end of Huckleberry Finn. Short of that, here’s hoping at least that Richard Cordray manages to make life miserable for them and to rein in their ability to make life miserable for the rest of us.

* * * * * * * * * *

West Virginia has just begun the process of licensing and regulating manufactured home communities, which seems like a necessary and therefore positive step overall. But the details matter.

I’m not sure what to make of this item from the proposed list of new regulations:

Manufactured homes will be inspected once a year. The health department may also make as many additional inspections as deemed necessary to determine satisfactory compliance with the rules.

I’m trying to imagine the response if the owners of non-manufactured homes – i.e., non-poor people — were informed that their homes would be subject to inspection once a year.

Howard Fineman reports that Mitt Romney owns six houses: “one in La Jolla, two in the Boston area, a ski lodge in Utah and two lakeside residences in New Hampshire.”

What do you suppose he, or his lawyers and lobbyists, would say if he were told that his homes were now required to “be inspected once a year”? Rich people and poor people really do seem to live in two distinct, separate Americas.

  • http://apocalypsereview.wordpress.com/ Invisible Neutrino

    Mitt Romney owns six houses? Jesus. Even Joshua Jordan only owns, like,  two.

  • Matt Platte

    I find it thrilling – and funny! – that you go first to King & Duke! Bravo!

  • http://stealingcommas.blogspot.com/ chris the cynic

    Good fracking god.  The idea of having someone come and inspect my home once a year is disturbing in the extreme.  Would it pass inspection?  Maybe.  It’s livable enough for me.  But, as much as I love it (and I do love it) it’s a low quality thing much of it built by people who clearly had no idea what the hell they were doing.

    Even if it were guaranteed to pass having a yearly invasion of my privacy to tell me, “This is an annotated list of the ways in which the home you love sucks,” would be extremely stressful.

    Having them come, “As many additional [times] as deemed necessary,” would be cause for despair.

    -

    Fortunately I don’t live in West Virginia and my home is of the not manufactured variety.  Which I assume means it sprang into being from a flower or something.

  • Cor Aquilonis

    I’m a renter at an apartment complex, so my home inspection occurs any time something breaks, which is at least twice a year.  Go ahead, ask me about the time the water heater burst.  Just ask.

  • http://www.facebook.com/people/Charity-Brighton/100002974813787 Charity Brighton

     It’s actually a campaign thing, part of his effort to get to know Americans from all walks of life by being in as many communities as possible.

  • PJ Evans

    In Los Angeles, apartments are supposed to be inspected every year. I don’t know if it actually gets done that often, though. (Mine was inspected in June. The manager was worried; he’s only had the job for a few months.)

  • Sephira

    So uh…

    What happened the time the water heater burst?

  • nirrti

    Another thing about those credit reports is some employers use these scores as part of the hiring vetting process. If you have low credit, it could be harder to find  the means (a job) to raise it. Yet another “grandfather clause” like situation for African-Americans who disproportionally start off in the job market with  loads of debt.

  • nirrti

     People who live in manufactured homes usually own them outright. It’s not like they’re renting an apartment which landlords are responsible for making livable.

    It’s just another example of how people just love to intrude and dictate the lives of the poor. If we judged corporations as thoroughly as we do poor people, there never would’ve been a recession.

  • http://profile.yahoo.com/QAFSMUTSS3RIX4J72TNLHGUDYM Bernard

    test

  • http://twitter.com/FearlessSon FearlessSon

    “Looks like an old TransUnion.  I’m picking up a lot of radiation. They’re operating without core containment. Well, that’s kuangzhe de, that’s suicide.”

    “… Reavers.”

  • guest

    Question for the group; I’d be interested if anyone had any insights they could share.  Why do the American super-rich stay in America?  If I could afford to own six houses, they’d be in places like Florence, or Cape Town, or the wilds of Scotland.  I can think of a few possibilities–1) they visit these places often but don’t establish households there 2) they like being in the US, where people worship their super-richness 3) being outside the USA makes them uncomfortable culturally; they don’t know what to expect from people 4) living in desirable non-American places requires more hassle and money than they choose to invest (I find that unlikely, but I don’t know)–does anyone have a good answer to this question?

  • Dan Audy

    Not an expert by any means but I think there are a couple major reasons.  1) They understand and are a part of the culture here.  They have power and respect (if they make any effort towards it) and they lose all those decades of connections and relationship building and have great difficulty building new ones (I can just imagine the boggles they’d get trying to promote US economic policy…well anywhere).  2) For all that they bitch and complain about the unfair tax burdens and such, the US is actually very, very good to the super-wealthy in terms of taxes and ‘creative’ accounting.  Pretty much anywhere in the first world they are going to end up paying more (and potentially looking at serious fines or jail time for what is accepted in the US) and if they go to the third world they have to have the inconvenience of things like bodyguard details and crappy infrastructure.

  • guest

    Both good points, thanks.  The first one in particular made me think–I’m American and live in Europe, and it still occasionally gets my goat that a couple of the things about me that are considered high-status in the US are either neutral or positively looked down on here.  And it’s true, now that you mention it, that one of the most important  benefits of being super-wealthy is the networks you have access to and the influence you can exert through them, and those wouldn’t be nearly as extensive or useful outside the US.

  • Catherineecarter

    Guest – I am curious, what high status characteristics are kissed in Europe?

  • Catherineecarter

    Dissed, dissed – not kissed

  • Sgt. Pepper’s Bleeding Heart

    Giant, obsequiously fuel-guzzling cars?

  • http://apocalypsereview.wordpress.com/ Invisible Neutrino

    I rather think “obnoxious” is the term :)

    “obsequious” carries the meaning of excessive bowing and fawning whcih is decidedly not part of the arrogance-gestalt of gas guzzlers :P

  • guest

    :) thanks for correcting the typo, ‘kissed’ had me baffled….  I don’t know about all of ‘Europe’ (I’m just protecting my anonymity a bit), but I can tell you about here where I live.   Where I went to school–generally I’m used to a bit of a shout-out for Cal, from which I have a couple of degrees; here, though occasionally people are familiar with Berkeley’s reputation (the story about the ‘NL’ parking spaces is true!) mostly I’m lucky if I get an ‘I’ve heard of it’, and it’s certainly not any kind of door-opener.  (I now have a degree from a school here which allows me to put a school-related Latin tag on my business card; I’m not entirely sure what people here think of the fact that I do that, but I think it’s hilarious.)  When I mention what I do for a living in casual/party conversation, I’m used to a ‘wow, no kidding?’/’you must be really smart’ reaction in the US; here it elicits zero enthusiasm, and  once someone literally said ‘oh…’ in a disdainful tone and immediately turned away looking for someone more on her level to talk to when the subject came up.

  • Robyrt

    I’m really not seeing the Equifax-to-racism connection here. The low credit scores of the black lower and middle class are a reflection of their equally bad financial situation: foreclosure, underwater mortgages, credit card bills, and all the other leeching attendants of life on the lower economic rungs these days. There are many other charges that can be leveled against the credit rating agencies, particularly their evil scheme to make consumers pay to do the fact-checking and monitoring that any honest financial services company would and should do themselves.

  • Nick

    Would eliminating the economic problems that currently cause lower credit scores for blacks and hispanics still result in low credit scores?  I seriously doubt that. Heck, when the bottom dropped out, I had one late payment and my credit score dropped by over 100 points.

    What I’m seeing is race-neutral  conduct that disproportionately affects blacks and hispanics because of economic factors.   That’s not to say it’s right, but I just don’t see racism.

    On the manufactured home rant, the way I read that is it applies to the trailer parks and not to the trailers themselves. But then, I read the entire article and not just the parts I agreed with.

  • PJ Evans

     I guess you must have missed that they don’t actually check the input to the ratings, and they include wrong information, information that applies to some other person of the same name, information  on closed accounts…

  • http://blog.trenchcoatsoft.com Ross

    What I’m seeing is race-neutral  conduct that disproportionately affects blacks and hispanics because of economic factors.   Would eliminating the economic problems that currently cause lower credit scores for blacks and hispanics still result in low credit scores? Heck, when the bottom dropped out, I had one late payment and my credit score dropped by over 100 points.That’s not to say it’s right, but I just don’t see racism.

    That’s mighty white of you.

  • http://www.crochetgeek.net/ Jackbishop

    I too am a bit skeptical of the charge of racism. Well, not of the effect that the credit unions are keeping the black man down, ’cause they definitely are, but of the specifics and the intent behind them: preventing the advancement of economically disadvantaged minorities’ advancement looks a lot, from the outside, like generically screwing over poor people (and for the record, I don’t think that’s cool either), and I’m thinking this may be a case of the latter.

    Arguably the intent is moot since the effect is the same, but looking at things which target the poor and/or minorities, it’s not always clear which group is the intended target. (My usual guess is that if it’s political in origin, it’s anti-minority, and if it’s a policy enacted by a business, it’s probably economic. Cynical, but tell em I’m wrong.)

  • http://apocalypsereview.wordpress.com/ Invisible Neutrino

    You…. did read the statistical analyses which showed differentials in average credit scores?

  • Robyrt

    Huh? The study from the Fed concluded that credit scores for black and Hispanic people were actually higher than they should have been if the scores accurately predicted credit repayment history. Is there some other analysis you’re referring to?

  • Robyrt

    Sure, but that’s not racist. They do those things to everybody. (I have some experience in the business and I can assure you there were errors in everybody’s reports.) The banks, on the other hand, often do targeted stuff like redlining.

  • http://apocalypsereview.wordpress.com/ Invisible Neutrino

    And for black Americans, that means they are starting at a
    disadvantage. Even near the height of the country’s economic boom,
    blacks had lower credit scores than whites. Data collected by the
    Federal Reserve from 2003 — in the most comprehensive study on race and credit scoring to date
    — showed that less than a quarter of blacks had prime credit scores.
    Meanwhile, about 65 percent of whites were in this top tier.
    The
    gap got wider as black and white Americans grew older, the Fed found. By
    age 75, the average black consumer’s credit score still had not reached
    the national average.

    From the article.

  • Bnerd

    You don’t see racism there? Ah, the luxuries we whites have of living in a “color blind” world. It’s nice isn’t it? The structure of the economy isn’t a coincidence. The fact that Blacks have always had worse financials than whites isn’t “race neutral”. It’s a facet of history that is part and parcel of the racism and prejudice they’ve had to face for over 200 years. It’s story is one of white flight away from urban centers and the resulting loss of jobs and infrastructure that now is disproportionately focused on maintaining suburban sprawl. It’s the result of bias and prejudice that kept Blacks from being able to attain higher education necessary to compete (and still does). We don’t have to worry for instance, that our name… If its too “black sounding”… Might actually result in a less of a chance of getting a callback for a job interview (as studies have shown, even accounting for job skills and education level). We don’t have to worry that most people think we’re drug users (as one study showed, with 95% of people in the survey picturing the “average drug user” as a black man, this despite usage rates almost identical to whites) and thus more prone to be targeted by police who have free reign to racially p

  • EllieMurasaki

    I’m really not seeing the Equifax-to-racism connection here. The low
    credit scores of the black lower and middle class are a reflection of
    their equally bad financial situation

    http://bradhicks.livejournal.com/312845.html –we white Americans have put considerable effort into making sure that the American Dream is reserved for white Americans, and the whole credit-score scam is part of that.

  • http://apocalypsereview.wordpress.com/ Invisible Neutrino

    You know, one thing that being Canadian and growing up in a country that’s far more ethnically homogeneous than the USA has done is shaped my thinking about who I expect to see as a criminal.

    You see, I’ve noticed nowadays that when I hear of a person being a criminal and I don’t see a picture attached, my assumption is that the person is white. I don’t know that other people necessarily assume this (and in truth, Aboriginals are overrepresented in the Canadian prison population), but given that my social milieu was dead-solid middle class in a country and a time when such a thing legitimately exist/ed….

    Food for thought about cultural perceptions of crime and how they relate to other phenomena as well.

  • Nick

    Being more human than white, I couldn’t say.

  • Sgt. Pepper’s Bleeding Heart

    I was thinking of “ostentatious” but my brain was too lazy to look beyond the initial letter and syllable count :)

  • LectorElise

     Please google “color-blind racism”

  • http://lliira.dreamwidth.org/ Lliira

    There are two ads on my screen to get my credit report now. 

    They replaced the Enneagram ad. http://www.skepdic.com/enneagr.html

    Fred, have you considered moving to a site where you can control the ads directly? I can’t give you money in your tip jar, but I would click on those. So far on patheos, you’ve been stuck with ads that either disgust me or bemuse me, and none that I’d feel morally okay clicking on. I have a friend who makes a decent full-time paycheck through her own site which she owns, and she doesn’t have anywhere near the number of viewers you do, nor does she update anywhere near as often as you do. Just something to consider.

  • The_L1985

    All of the above, plus a big ol’ dose of good old Southern xenophobia.

  • The_L1985

     You don’t see overt racism.  If something disproportionally affects racial minorities, and you enact it anyway, racism is a factor, however carefully hid.

  • Nick

    This disproportionally  affects the POOR and middle class, regardless of race.

    I’m not saying there is no racism (overt or otherwise) in our society; I’d be lying if I did.  The systemic racism in our society is as strong as ever.  But the only way to change that racism requires major changes in how we educate our children and how we treat the least among us.  Until everybody has the same opportunity for success as anybody else, there will be racism.  Given the current political climate, that day is a long way away.

    And, like the Inquisition looking for heretics, those looking for racism will always find it, because racism (or the appearance of racism) is always there.

  • The_L1985

    I agree.  However, the whole point of the disgraceful “welfare queen” tactic is that those people don’t deserve welfare because they are the wrong kind of poor people.

    And…”welfare queen,” at least in the South, implies black.  Racism is one of the forces that drives classism in our society, even though most poor people in America are white.

  • Laura Peppiatt

    I have been hit by Equifax…
    I own a property in London that I bought last year after the divorce; my credit score was excellent when I applied for a mortgage a year ago. I have a current & three savings accounts with Santander and a car.
    I have had a highly paid permanent job for more then 10 years, have a big mortgage, pay all my bills by direct debit, never missed a payment for anything…
    About three months ago I applied for a credit card from my bank and was refused. I went to my branch and found out that Equifax did not link my old addresses with my new address. My bank apologized and immediately issued a card for me. I thought it was the end of the story and that Equifax will correct the data. It seems that they don’t care! They force people to pay for their services. I am in a process now to obtain my credit report. It is a pain. The customer service in Equifax is awful. The internet application is primitive and buggy. All this business is very time consuming and upsetting. But I have no choice now as to find the truth. I tried to find how to complain but it seems that the credit agency does not have a complaint procedure. It is unbelivable!

  • Asbestos Lawyer

    What is the need to own six houses, that is a waist of money in my mind.

    http://www.nationalasbestosattorney.com


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