Credit Reports: Last Week Tonight with John Oliver (HBO)

credit reports the basis for the single most important three-digit number in your whole life other than of course 311 the Beatles of rock rock lettering credit enables businesses to know who to lend to it's critical to our economy and it always has been millions of people use credit to buy the things that add up to a better living well there's sure a lot of things that I'd like to buy for better living how about giving me a little credit nobody gives you credit John that's something you have to earn to earn credit first you have to develop your character you have to have capacity to pay your bills and third you need some capital scoring high on these three C's is essential to earn a good credit rating of course back then there was a fourth C determining your access to credits namely what color you were little bit weird that one didn't make the movie but but you might be surprised at just how many aspects of your life your credit report can affect because it's not just banks deciding whether to lend you money it's also landlords deciding whether to rent you an apartment insurers setting your rates and even employers using it to decide whether or not to hire you 47% of employers do conduct credit checks on new potential hires and it is legal if the employer gets permission from the applicant that's right nearly half of employers delve into credit histories when hiring I just look on Craigslist because you'll find credit checks are required in all sorts of job listings from managing a Benihana in Cincinnati to this one which reads who runs those fireworks tents it could be you application with good credit check required which is clearly ridiculous they don't need to bring credit into that job they just need to ask the question what do you think of fireworks and then hear the answer fireworks off consider oh oh you love lighting those cuz the only three digits they need to see are the ones on that person's two hands there there are there are three big credit reporting firms Equifax Experian and TransUnion all three aggressively market their products for uses beyond lending for instance listen to how Experian convinces employers that your credit may reflect your future job performance if you manage your credit well then it's very likely you're going to manage the company's money well yeah is it though because look at me my credit is probably fine but I routinely waste HBO's money on stupid costumes pyrotechnic displays and checkered dress shirts I clearly cannot manage this company's money well as well as the TransUnion their website explicitly states that credit reports help employers make decisions quickly and easily when deciding on potential candidates which is a little surprising given this exchange between a representative from TransUnion and an Oregon Legislature what is the evidence that there's a strong correlation between accessing an applicant's credit history and eventual problems of loss to the employer or to the clients I guess in that case I would say that there at this point we don't have any research to show any statistical correlation between what's in somebody's credit report and their job performance or their likelihood to commit fraud okay so they admit there is no evidence of a correlation which does make sense because a good credit score could mean you're unlikely to commit fraud but it could also mean that you're soaking amazing at it you've never been caught and I'm incidentally not thirty seconds later that guy said this given all things equal between two or three job applicants for person as a high high amount of debt versus somebody who doesn't and all things other being equal well maybe they want to consider that so wait he's saying there's no proof of a correlation but you're free to imagine that there is which is not a strong argument I can imagine that eating alphabet soup will increase my vocabulary that does not make it indubitable indubitable ein you ate a lot of letters yesterday but look giving too much credence to credit reports as a measure of character may be a big mistake first over half the debt on credit reports comes from medical expenses and it seems unfair to judge someone for that no one chooses to be sick with the possible exception of Julianne Moore taking a run at Best Actress but but also credit reports can contain a shocking number of errors a new government study found about 25 percent of consumers have an error in one of their credit reports the study also found about 1 in 20 had significant errors that could cause them to pay more for a car loan or a mortgage just think about that warning for had an error and 1 in 20 was seriously wrong and that is not good if every 20th frosty that Wendy's sold turned out to be a cup of warm goat semen we would want some accountability and we'd want it fast at least freeze it and and look those those errors can be anything from including debt that you've already repaid to mixing you up with someone else entirely take what happened to a woman called Judy Thomas she couldn't figure out why she kept getting turned down for loans until she looked at her credit report I saw debt from Utah Medical Center I saw debt from a veterinarian clinic in Utah I saw collections for a Judith Kendall Judith Kendall mmm not Judy Thomas crank what's going through your mind what the hell she doing on my credit report the hell's her debt doing on my credit report Wow how can someone call Judy Thomas be mixed up with Judith Kendal and also if she's going to be mistaken for anyone how is it not Lesley Stahl because that is spooky and it actually gets worse because if a credit reporting agency matches your name to a list of suspected criminals the US has sanctions against as they did with Amit Patel you may be in for an unpleasant surprise after being denied his dream apartment he asked his landlord why as an answer the landlord forwarded his credit report can you read this for me what does that say terrorists holy that is terrible because one he is not a terrorist and two I do hope we have a better strategy for dealing with terrorists than flagging their credit reports and denying them their dream apartments what not in America not in America and and being mixed up with a terrorist is not even the worst thing a credit bureau can do to someone Helen McGill was shocked when she went to buy a travel trailer to learn she was dead the financial manager came out and said do you have like a copy of your card because you keep coming up deceased so I was like there's no way three major credit bureaus listed her is deceased I even paid at that point to to get my credit score you can't get anything when you're deceased no credit score there's nothing you don't even exist just one error on your credit report and suddenly the world treats you like a mean girl treats the high school debate team you're nothing Amberly you don't even exhaust and and here is the thing it would be bad enough if this just involved the three big credit bureaus but on top of that there are now hundreds of different companies providing even broader background checks which may bundle credit information with things like criminal or driving records and while some companies appear to operate responsibly others like general information services or G's - things that make you doubt their judgment we actually found this fun video they made featuring snow white coming to them for help now Barry tail isn't an industry that we specialize in but lucky for you our magic mirror can find anything worth locating if only you were in the insurance industry we created tons of solutions for those guys oh my who's that it fairy we're an equal opportunity employer whoa hold up there's not a homophobic fairy joke because it's hard enough to accept judgment from a company that would do that let alone deliver it with the acting skill of a shy third grader and background check agencies can take all the problems of credit reporting while adding a few more and let's begin with the obvious here as we've discussed before on this show a criminal record does not necessarily mean you're a bad person or that you shouldn't be hired but if you are going to use a criminal background check to make decisions at the very least they should be accurate and frequently they are not take Samuel Jackson from Chicago no relation to the actor obviously or to the three different sex offenders one company confused him with even though one of those convictions happened when Jackson was just three years old or as his lawyer puts it the background check company was aware that mr. Jackson is only 30 years old so it clearly couldn't have been him and obviously he can be all three sex offenders at the same time of course of course not because there's only one person who could pull off being three sex offenders at the same time and that is mr. Neil Patrick Harris I'm not saying is I'm saying he has got the performance chops to make you believe it is possible if you put it might if you put his mind to it he could be the literal triple threat he's that good he's that good a performer and and remember these mistakes can cost people housing and jobs it is no wonder that many firms have wound up facing legal challenges for instance just last year GIS and their affiliates had to geez out 13 million dollars in fines and damages and while they admit no wrongdoing they've now lost so much money their next shitty video is probably just gonna be a filthy parrot in an old warehouse screaming Polly wants a background check and at this point you are probably thinking well holy I should probably check my background and credit reports well the good news is under a law called the Fair Credit Reporting Act the big three credit firms are required to give you a copy once a year and there's even an official site where you can get yours but if you do spot an error your trouble may just be beginning remember Judy Thomas it took her a surprisingly long time to get her credit fixed it became a six year battle with credit agencies requiring box loads of Correspondence to try and prove that she was Judy Thomas not Judith Kendall all to no avail I also hired a local attorney to try and straighten it out we had everything certified um that this is Judy Thomas this is where I live I've never gone by the name of Kendall I've never even been to Utah let alone owing a cable company in Utah and what happened nothing oh come on at this point I'm surprised you didn't just go you know what kit I'm Judith Kendal I'm moving to Utah and I'm getting a sick pet and a cable package at least then my life will make Sun King sense to me it is it's probably not surprising that when we crunch the numbers we discover that the three big credit bureaus have been the subject of the most complaints to the CFPB since the start of last year and they may say that sometimes they receive inaccurate data from creditors of the mistakes don't originate with them but if that's true their method for resolving those problems clearly needs to be better and in a settlement agreement just last March they actually pledged to improve their dispute resolution process but before you get too hopeful about that it's worth noting the industry has claimed for decades that they are always improving their accuracy and yet for 25 years now the news stories about them have had something of a similar tone we saw a recent study that said 25 percent of credit reports had err serious enough to deny you credit a new study finds a staggering number of credit reports contain mistakes a new study says credit reports frequently have errors that can be very costly for consumers a survey by the US Public Interest Research Group found nearly one-third of all credit reports contain serious errors you don't have to spend long preparing a broadcast about credit agencies before you learn one simple truth everyone and I mean everyone has a horror story it's it's pretty obvious that problems with credit agencies are a classic new story trunk-like oldest person dies or scary new teen sex trends coming up we've all heard of Netflix and chill but what does it mean when your team says they're going to Hulu and it is not as innocent as it sounds there is the point is there is nothing new about this problem in fact when we were researching Judy Thomas's story we found a news clip about a lawsuit from 2002 that gave us deja vu it was the culmination of a six-year battle for a Judy Thomas who tried repeatedly to get TransUnion to clear up the mistakes on her credit report another Judy Thomas some Judy Thomas was not even the only Judy Thomas this had happened to the lesson here is pretty simple if you or someone you know is named Judy Thomas give up there is no hope in life for Judy's like you and if anything things are even worse with background check companies because they are also required to give you a copy of your report if you request it but there's a massive loophole there because unlike the credit bureaus most of them don't keep files on all consumers they just search for data when someone pays them - and if you're about to apply for a job or an apartment you might think well I want to be sure that there isn't a problem on my report so I'll just buy it first myself so we actually asked these companies if they'd let us do that and they all said no meaning if they confuse you with a sex offender you might not find out until that job or apartment is all but gone and of course you know who you have lost it to don't you Neil Patrick Harris you wouldn't even think he could take a certified public accountant job but he can and he does it so well and he's a likeable while he does it he is so good no now to be fair to be fair here some companies will sell you your own report so we had some of our staffers buy their own background checks from a few companies while most of them came back fine five of our staffers reports including alias names that they'd never heard of before and one staffer Charles Wilson was mistaken for a man who was indicted for Medicaid fraud in Florida now now that site did say Charles his listing was pending verification and it was later removed from his report but it was still too late because by that time in a Spartacus style show of support our entire office had already rallied around Charles and committed Medicaid fraud because we care about him and listen given the stakes here you would hope that these background check companies are being closely monitored but as this FTC official admits there was no lahrman amount that they don't know is there any kind of national list of these companies no there isn't so we don't know how many companies companies are even out there no we don't and I think that's one of the challenges yeah no that's one of the challenges you can't just lose track of how many background check companies there are the way that we've all lost track of the number of Oreo flavors roots be afloat are you kin kidding me you are sick Oreo you're all sick and and the problem is this whole industry seems uncomfortably complacent in fact remember that FTC study that I mentioned at the start which showed that one in twenty credit reports had serious errors an industry trade group put out a press release in response to that with the title FTC report confirms credit reports are accurate arguing that it showed ninety-five percent of consumers are unaffected by errors in their credit report but when you are holding records for more than 200 million individuals that 5 percent error rate affects 10 million people they're basically saying great news everyone we only up a group equivalent to the entire population of Sweden King greatest if only we could make this whole industry understand the Jeopardy that they're placing people in you know what maybe we can because remember the big three credit companies Equifax Experian and TransUnion well we started three terrible companies with names that are problematically similar to this specifically Equifax Experian and TransUnion what do those companies do great question if you just visit Equifax comm you'll see that they take shelter animals to customers homes where the animals lick peanut butter off people's genitals before being immediately returned to the shelter Equifax is just an awful company but but don't worry Equifax I can't imagine anyone will mistake them for you and and if you go to Experian comm you'll find a company that sends people to whisper passages from mine camp into babies ears with the permission of these are the baby nor the parents and finally don't miss trams annyeong comm where you can buy these delicious-looking stakes made from the flesh of dead orcas who worked at SeaWorld it would it would clearly be an absolute disaster for the credit agencies if they were mistaken for any of these companies but don't worry I'm sure that won't happen 95% of the time and apparently that's good enough right you

Channel: LastWeekTonight

Views: 11,595,991

Keywords: last week tonight, last week tonight with john oliver, credit reports, credit reporting, background checks

Id: aRrDsbUdY_k

Length: 18min 46sec (1126 seconds)

Published: Sun Apr 10 2016

Reddit Comments

[u/[deleted]]

I'm really glad he's bringing attention to the mistakes Experian, Equifax, and Trans Union make. I've sued these companies for years, and continue to do so, because of the appalling mistakes they make. I've seen people lose jobs, mortgages, and apartments because of this. The good thing, though, is that you can sue them under the Fair Credit Reporting Act for the damage they cause, and they have to pay you (and your lawyer - so you never have to pay a lawyer to represent you in these cases).

[u/RedoftheEast]

Frightening. How many of these companies are there? We don't know. How many people have an error in their report? One in four or five. How many have a ridiculous error in their report? 1 in 20. Is it a new problem? No, it's been more or less this bad for over 20years. How?!. Just how?!

[u/SovietShooter]

There is actually a secretive fourth credit reporting agency - Innovus, aka CBCInnovus, aka CBC Companies. I used to work for them.

Essentially, they pull tri-merge credit reports for mortgage companies - an RMCR. The information is then verified, and stored by Innovus, who then sell the credit info to other companies for profit. So basically, if you ever tried to get a mortgage loan thru a lender that uses CBC to verify their RMCRS, CBC then processes the info and sells it as Innovus.

[u/WINSTON913]

Used to work for experian doing customer retention for freecreditreport.com. Huge scam to trick people into paying like $30 non refundable. AMA

[u/carny666]

I love how those web sites, at the end, are really there.

[u/aerojonno]

Mirror for us Brits?

[u/pifhluk]

I'm sure soon enough well have 50 different numbers from 300 different companies attached to us. Job performance 674, fitness: 582, tech level 783, personality 644 and on and on. Well all just be a walking number for corporations to pick and choose. Sports have already started this path with advanced statistics.

[u/Jshrad]

John Oliver is doing fantastic work. His analysis is funny, to the point, and gets people inspired to fix these unbelievable problems.

[u/[deleted]]

Have an error on my credit - a wrong address I never lived at. Tried to "dispute" it through one of the big 3 company's websites, but the site crashed or failed every time I tried to click the "submit a dispute" button. Gave up. Still live in California according to credit report.