Clearing Credit Record Can Be Complex

Question: Last June I wrote you concerning a credit dispute with TRW Information Services over an erroneous entry in our credit file alleging that we had stiffed Wells Fargo Bank to the tune of some $2,000 five years earlier. As you may recall, their PR person feigned surprise and ascribed their sullying of our credit reputation to mistaken identity. Further, TRW claimed to have straightened out our record with Wells Fargo, and we should be out of the credit leprosarium. Right?

Wrong. Recently we wished to reactivate a dormant charge account with the Broadway and, lo and behold, found another credit reporting bureau, Trans Union Credit Co., lurking in the weeds. Turns out their file contains the same false Wells Fargo entry as the TRW file, which would lead one to suspect that there is little confidentiality in these files.

However, the Trans Union report had another false entry, which may be the clue and the true explanation of the errors--a listing of a “previous” address that rang a bell. Some years ago (‘80-’81), we were contacted by an Orange County Cadillac dealer regarding a vanished car leased to a person using my name supposedly residing at the address listed by Trans Union. When the dealer learned that we were not at that location but at our present address, his reaction was: “I was afraid of this.”

I have heard on good authority that a gang of con artists was fleecing car dealers, oil companies, banks, department stores and others at that time and were doing so by hacking into a credit bureau’s computer file and choosing subjects with clean credit records and few, if any, obligations.

False ID No Problem

False IDs and drivers’ licenses were no problem, and the next step was a new address listing the real person’s former address as a current address so that an avalanche of bills, past-due notices and threatening letters would not blow their cover until the cow was milked dry.

Which brings to mind the interesting question of the accountability, or lack of same, of these credit bureaus, not only to the individuals they are besmirching with phony allegations but to the subscribers who are being taken for a ride on the basis of phony positive credit information. In the absence of malice, I don’t suppose that we would have an action for libel, but I wonder about the car dealer who buys a credit report which influences him to hand a crook the keys to a $25,000 automobile.--F.J.

Answer: In light of your track record with the local credit reporting companies, I’m a little surprised that you’re not serving three to five years at Folsom prison on the basis of some crook’s felony rap sheet, which also could have somehow sneaked into your file. Getting hung up twice--denied credit--in the same year on the basis of the same phony mistaken-identity entry defies the law of averages in about the same way that hitting the state lottery jackpot twice in the same year would.

Or does it?

Mike Wolfe, operations manager for Fullerton-based Trans Union Credit Information Co., concedes that obviously you somehow fell through a crack--that would accommodate a 16-wheel truck--in the credit-reporting network.

“You normally assume that once you’ve discovered an error like this, the credit grantor (in this case Wells Fargo) will, of course, notify all of the credit-information companies and that’s that. I don’t want to point the finger here--we could have dropped the ball, Wells Fargo might have--we’ll just never know.”

Complicating the situation further, Wolfe adds, is that while TRW may have the highest profile here, Trans Union has fully as much credit information as TRW does, and now, relatively recently, there’s a third credit data base involved--CBI, or Credit Bureau Inc., which has come in from the East Coast. All of which means that having an iron-clad assurance that the error has been expunged from TRW’s records doesn’t necessarily mean that the same error has been wiped off the records of the other two--it should, but it doesn’t, Wolfe admits.

“What you should do, to be on the safe side, is to get a letter from the credit granter saying that there was an error and that it has been cleared from its records, and then send a copy of it to all three--TRW, Trans Union and CBI--and keep a record for your own files,” he continues.

“It’s really unfortunate in a case like this that the burden has to go back on the shoulders of the consumer--who had nothing to do with the error in the first place.”

Now, of course, we have Wolfe’s assurance that that phony Wells Fargo cloud that has hung over you like Banquo’s ghost for the past six years will be expunged from Trans Union’s files too (Trans Union can’t itself arbitrarily strike it out, of course, but can get the clearance from Wells Fargo), which leaves only CBI to worry about.

And, Wolfe adds, that misused “previous address” that has similarly plagued you will also be stricken.

All of which underlines the growing complexity of the information industry and the growing threat to any individual’s privacy. Just how foolproof are these credit-reporting-company computers?

None of the companies will actually admit that its computer has ever been dipped into by someone without authorization. Nor will they deny it, hands down.

“It’s a constant danger,” Wolfe admits. “We do everything we humanly can to safeguard our data, but the hackers are getting more sophisticated all the time. So, it’s a valid concern.”

Concern to Subscribers

Not only a valid concern for people like you, who have been twice burned by the same piece of erroneous information, but for credit-granter subscribers to TRW, Trans Union and CBI who, as you say, stand to lose thousands and thousands of dollars by extending money, goods and services on the basis of positive but phony credit records. The biggest cost to you is inconvenience and embarrassment. Not so with that Cadillac dealer who contacted you several years ago.

So, to be on the safe side, don’t be content with getting a copy of your credit report from one reporting agency showing that the error has been expunged. Get a copy of the letter that the credit granter wrote authorizing that erasure, make sure that the other two credit bureaus get a copy of it and keep a copy, yourself, in a safe place.

“That’s particularly important,” Wolfe notes, “because if it’s three or four years after the fact before you find that the error is still floating around, the trail could have gotten awfully cold. Under the best of circumstances, it’s going to entail quite a bit of research on the part of the credit granter to go that far back and verify that an error did occur. People change jobs, records get lost.”

And if the credit granter has difficulty verifying the error, it can be just as stubborn as anyone else in admitting to a mistake that it might, or might not, have made.

Don G. Campbell cannot answer mail personally but will respond in this column to consumer questions of general interest. Write to Consumer VIEWS, You section, The Times, Times Mirror Square, Los Angeles 90053.