Dr. X's ordeal with Bank of America

Bank of America certainly has a tendency to make their customers mad.  They have done it to me.  They have done it to scores of clients I have represented in litigation against them over the years.  Now, they've done it to Dr. X.  And he wants the internet to know about it.

Read his story here - http://drx.typepad.com/psychotherapyblog/2012/06/bank-of-america-stealing.html.  It sounds oh so familiar.

The Truth About Credit Repair Companies

I am often asked what the deal is with credit repair companies.  Can they really remove derogatory but accurate credit history from a person's credit report.  The short answer - NO!!!  So, all of you out there, quit paying money to these companies to "fix" your bad credit.  Instead, use that money to pay your debts and get your own self out of the hole that you unfortunately find yourself in.

Apparently, I'm not the only one being asked this question.  Below is a link to an article on foxbusiness.com regarding credit repair companies.  Their advice mirrors mine.  Here's the link - http://www.foxbusiness.com/economy/2012/06/18/is-there-legit-company-to-fix-my-credit-score/

The Band is Back!!!

Anyone who has read this blog knows that I don't exactly love Experian.  I also don't really like their subsidiary freecreditscore.com, since they don't really offer free credit scores.  But I have to admit, I liked the down and out band that starred in the original freecreditscore.com commercials.  From living in the basement of their in-laws and having to settle for early '90's style cell phones, all due to bad credit and not knowing their credit score, these guys exemplified the rough life of having bad credit.

I'm not sure if they wrote their own songs, but the songs were so great and really underscored why your credit score is so important.  In fact, given Experian's tendency to not report accurate credit (which in turn leads to inaccurate credit scores), I think the commercials starring the original band were helpful in educating potential jurors across the nation about the importance of credit scores, jurors who hopefully would make Experian pay proper compensation to those injured as a result of Experian's failure to abide by the provisions of the Fair Credit Reporting Act.

For some reason, freecreditscore.com did away with the popular band, held a contest to find a replacement which simply turned out not to be as entertaining as the original band.  Apparently seeing their blunder, freecreditscore.com has announced that its bringing the original band back!  I can't wait to see some new material from them.

Online data - the new credit report?

Here's a link to a good article about the emergence of spokeo.com type consumer reporting agencies and the importance of the Fair Credit Reporting Act being applied to them. The collection and sharing of online data about consumers is really a growth industry right now and one that I will be focusing more on in future posts and (I am sure) future lawsuits for consumers.

Here's the link I mentioned - http://www.mobiledia.com/news/154050.html

Vermont passes legislation to limit use of consumer reports by employers

A Vermont law going into effect on July 1, 2012 will severely limit the use of consumer reports by employers during the job application process.  Joining California, Connecticut, Hawaii, Illinois, Maryland, Oregon and Washington, Vermont is the eighth state to pass such a law, with Vermont's arguably being the most restrictive to date.  For a full summary of the new Vermont law, click here - http://www.jdsupra.com/post/documentViewer.aspx?fid=4a2b9a29-984d-4000-883e-1f4427f51632

MoneyTalksNews.com's article on destroying high interest debt

As usual, I love what MoneyTalkNews.com is saying.  Here's another excellent article from them about destroying your high interest debt. Definitely worth a read.

Another way to help destroy high interest debt?  Make sure your credit report is accurate.  Inaccurate derogatory payment histories kill your credit score.  Also, credit cards that don't report an accurate credit limit can hurt your credit score because that can affect your debt to available debt ratio.  Too high of a ratio is a bad sign to potential lenders, so they up the interest rate they charge you to cover their perceived added risk.

Also, make sure the balances reported by your creditors is correct.  Too high of a total balance of debt is bad for your debt to income ratio, which can also hurt your credit score.

But I digress.  Here's the link I mentioned - http://www.moneytalksnews.com/2012/06/19/ask-stacy-how-can-i-destroy-high-interest-debt/?utm_source=Money+Talks+News+Updates&utm_campaign=email-2012-06-19&utm_medium=email  Happy reading!

Potential data breach at the University of North Florida

From the Florida Times-Union's Jacksonville.com website:

A computer database containing information about 23,246 people who submitted contracts to live in the University of North Florida’s residence halls might have been compromised by a hacker.

School officials have locked down the affected computer server as they try to find out if any personal information was taken.

The database included names and Social Security numbers of people who submitted housing contracts between 1997 and spring 2011. The hacking could have occurred as long as a year ago, according to UNF officials.

“When we first started to suspect someone who was not authorized had gotten into the database, we immediately began investigating,” UNF spokeswoman Sharon Ashton said. “At the same time, we moved the information off that server and put it on a different server, and put additional security measures in place.”

The investigation needed a few weeks to determine which file was broken into, then how to get in touch with everyone on it to alert them to the breach, Ashton said. Now the university is sending them letters and emails about the breach.

“We don’t have any evidence that any information, or that anything, was copied from the files, but it is a possibility,” Ashton said.

So far, Ashton says, none of the people that were in the database have reported their personal information was used. The school will pay for one-year memberships in a credit-protection program for anyone impacted. It has set aside $80,000, but is prepared to pay for all 23,246 if they request it. And school officials recommend they place a fraud alert on their credit files via Equifax, (800) 525-6285; Experian, (888) 397-3742; or Trans-Union, (800) 680-7289.

In October 2010, someone gained access to personal information on almost 107,000 UNF students, potential students and employees. Other universities have been affected by hackers more recently.


The University of Nebraska identified an undergraduate student in May it says is responsible for breaking into a school database with information on more than 650,000 students, parents and employees, according to www.computerworld.com. And in January, Arizona State University shut down its web services after someone downloaded an encrypted file containing user names and passwords of an unknown number of students, faculty and staff, according to the school.

Equifax's stock hits 52 week high

Equifax's stock price has reached a high point for the past year yesterday, closing Thursday at $47.78.  I guess it pays to outsource your investigation department to Jamaica where you can pay investigators less than minimum wage.

Scam Alert - Placing an ad on your car doesn't get you paid

I just heard of a new scam.  It goes like this.  You receive an e-mail or other solicitation that indicates that you can add an advertisement to your car, drive it around, and get paid by the advertiser.  To do this, you just need to pay a one time fee of $39.95.

Unfortunately, this is a scam.  While it is true that there are companies that will hire you to drive around a vehicle with their ads on it, you don't have to pay a membership fee to do so.  Any offer where you are supposed to get paid but requires a payment from you to get started is almost always a scam.

As I often heard growing up, if it sounds too good to be true, it probably is.  And that's even more true in this day and age.

Dishonesty on credit card applications at three year high

The level of dishonesty on credit card applications is on the rise, according to a recent study by Experian.  Not that Experian is actually known for its accuracy, but for the sake of argument, lets assume Experian's study is accurate.

According to Experian, 44 out of every 10,000 current account applications were found to be fraudulent in the first quarter of this year.  This represents an increase of 23 percent over the last three months of 2011 (which would include the holiday shopping season which to me would seem like a time of the year that would be highest for this sort of fraud).

Current account fraud includes things like misrepresenting income or exaggerating or hiding personal information, such as bad credit histories.

While troubling, another way to look at the figure of 44 out of 10,000 is that its a lot less than Experian's error rate which is somewhere around 2,500 out of every 10,000 credit reports containing serious errors!

Experian's 2012 Annual Report

Here's a link to Experian's 2012 Annual Report - http://www.experianplc.com/investor-centre/reports/investor-reports/2012a.aspx.

Looks like Experian is raking it in. Their revenue is nearly 4.5 billion and is up by over half a billion from last year. I need to start requiring them to settle with my clients for more.

Spokeo Settles FTC Charges

Spokeo to Pay $800,000 to Settle FTC Charges Company Allegedly Marketed Information to Employers and Recruiters in Violation of FCRA

Spokeo, Inc., a data broker that compiles and sells detailed information profiles on millions of consumers, will pay $800,000 to settle Federal Trade Commission charges that it marketed the profiles to companies in the human resources, background screening, and recruiting industries without taking steps to protect consumers required under the Fair Credit Reporting Act. This is the first Commission case to address the sale of Internet and social media data in the employment screening context.

The FTC alleged that Spokeo operated as a consumer reporting agency and violated the FCRA by failing to make sure that the information it sold would be used only for legally permissible purposes; failing to ensure the information was accurate; and failing to tell users of its consumer reports about their obligation under the FCRA, including the requirement to notify consumers if the user took an adverse action against the consumer based on information contained in the consumer report.

It was a pretty complicated issue as to whether Spokeo is a consumer reporting agency or just a search engine.  The difference between Spokeo and Google, for instance, is the focus of searches run on the different sites.  On Google, you can search for anything.  On Spokeo, your search is limited to the online identities of individuals, i.e. their identities on Facebook, MySpace, Ebay, dating sites, etc.  Spokeo is thus a dream site for potential employers to research potential employees.  Yet Spokeo did not comply with any of the FCRA's requirements regarding being a consumer reporting agency or regarding the publication of consumer reports to employers.  I suspect that will change with today's settlement.

The ins and outs of 0% balance transfers

Yet again MoneyTalksNews.com has an insightful article with good, basic advice. This particular article is about the benefits and risks of zero percent credit card balance transfers. Basically, the risk is the fee that most credit card companies charge to transfer a balance and the risk that you lose the incentive to pay down the debt while york are not being charged interest. The pros are that, if done right, you can save a ton on interest.

The article is here and is worth a read - http://www.moneytalksnews.com/2012/06/06/credit-card-debt-zero-balance-transfers-can-help/?utm_source=Money+Talks+News+Updates&utm_campaign=email-2012-06-10&utm_medium=email. Happy reading and balance transferring!

Another article about credit scores affecting insurance premiums

The Columbus Dispatch has published a well written article about the effect your credit score has on the cost of insuring your vehicle and home and how most consumers don't even know about how their good or bad credit history affects them.

A good point made by the article is how the use of credit scores when setting insurance premiums underscores why the accuracy of credit reports is so important. It's not like you can dodge insuring your car (which is required in many if not most states) and mortgage companies rightly require that a home be insured before financing the purchase. Thus, the protections afforded consumers by the Fair Credit Reporting Act are important because they help ensure accuracy. In fact, the FCRA requires that credit bureaus use reasonable procedures to assure maximum possible accuracy of the credit reports they generate.

Litigation pursuant to the FCRA is thus an important threat to keep the credit bureaus as accurate as possible. Without the threat of a lawsuit, the FCRA would be a dog without teeth - all bark with no bite. Many legislators who cater to the interests of businesses over consumers often want the litigation threat of new laws limited to non-private enforcement. Such a limitation means that a consumer can not sue due to a violation, only a government regulator type entity (i.e. the FTC or state attorneys general) can sue. And, even if willing to do so, most such entities do not have the manpower to do so. Hence the reason why private enforcement through private representation by attorneys is so important to the enforcement of the FCRA because, without it, the credit bureaus could run amok, causing havoc to the entire economy.

The article is here - http://www.dispatch.com/content/stories/local/2012/06/10/bad-credit-raises-cost-of-insuring-car-home.html - and includes personal stories of consumers with perfect driving histories that miss a credit card payment or two and suddenly are perceived as horrible drivers or more apt to have their homes hit by a tornado.

Craziness.

Identity theft insurance - just not worth the money

Money Talks News recently published an article about eight types of insurance or other protections that are not worth the money they cost. What did Money Talks list as the number one not worth it protection? Identity Theft Insurance.

Here's what Money Talks said:

"Identity theft insurance doesn’t protect you from becoming a victim of the crime, or sometimes even replace money lost. The insurance only covers some of the expenses you accrue dealing with identity theft – like the cost of mailing letters to your creditors and maybe some legal fees. And it costs $20 to $100 per year – plus a $100 to $1,000 deductible, according to MSNBC.

Instead of paying for extra insurance, see if your credit card company offers identity theft recovery services. Some companies, like American Express, help you free of charge.

If your card doesn’t come with it, you can still protect yourself. The Federal Trade Commission has a list of steps to take if you’ve been victimized by identity theft on their website – like placing a fraud alert on your credit report and canceling affected credit accounts."

What do I think? I think identity theft insurance is not only not worth the cost, its also harmful in a lot of cases. The identity theft insurance policies I have seen often limit the insured's ability to file any type of lawsuit or seek compensation for his or her injuries. Others limit your attorney selection to the attorney hired by the identity theft insurance company, who will probably not be willing to pursue a claim on your behalf.

You are much better off to take the steps that I and others have suggested - i.e. the vigilance and diligence mantra that I espouse ad nauseam - and, if those steps don't work, hire an Fair Credit Reporting Act experienced attorney to file a lawsuit for you.