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Credit Repair Scandal
According to the Los Angeles Times, a credit-repair company from Riverside, California bribed employees of the three major credit bureaus, Trans Union, Equifax and Experian. This credit repair scheme attempted to increase credit scores for hundreds of their clients. Federal prosecutors said this credit repair scam may have caused mortgage lenders experience losses amounting to $6 million.
For genuine credit repair services, check out Credit Repair United online. A federal indictment returned by a grand jury in Southern California a few years ago named three Southern Californians and two New Jersey residents in the alleged yearlong fraud that took place beginning in February 2001. Experian said it triggered the investigation in early 2002 after it caught and fired a Dallas employee who was part of the scam.
In the past, credit-bureau information has been misused to commit identity theft, authorities said. But neither prosecutors nor consumer advocates could recall a case in which insiders at credit bureaus systematically falsified credit files. According to Edmund Mierzwinski, consumer-program director for the U.S. Public Interest Research Group, "It raises many issues about credit-reporting security and whether or not its electronic systems are secure.
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