New Orleans Joe Nocera, the “Talking Business” columnist for the New York Times wrote a “peoples” piece today, which is worth a couple of atta-boys! The whole problem of home mortgages and the ridiculous power of credit scores (FICO scores) could be the subject of whole books for the scam involved and the damage done, but at least let’s applaud some much needed balloon busting.
The first fraud of the credit world and its power he only deals with in glancing fashion, but it’s worth keeping in mind. The credit bureaus still hold the individual citizen consumer responsible for the accuracy of their garbage, rather than even performing the minimum of due diligence despite the disproportionate weight their ratings have on citizen wealth and our futures. Huge businesses that are anything but transparent (how many of us have ever reached out for our credit scores really?!?) yet take no real responsibility for anything other than “garbage in, garbage out.”
Nocera starts with a story from a mortgage broker in Connecticut of a client whose scores changed (and therefore interest rate increased!) when a credit company lowered their score when they changed to another credit card company even though their debt stayed the same. All this really indicates is that a computer program is creating the scores. Hardly news.
More telling were the pieces about the inaccuracies in Nocera’s own reports. Here is a guy in “big whoop” world taking a bunch of hits in the high air, when he examines two reports. The list of errors is a farce that would be funny if this didn’t happen to so many people who are powerless to change the reports and more frequently oblivious to their impact and existence. One said he worked for Fortune and not the Times, while another said he worked for Rite-Aid drugstore! His home address was listed as his daughter’s former address in Brooklyn. There was a claim that he had credit card accounts that in fact he had never had, while ignoring according to him one big fat one he did have. One report said that he no longer lived in a house he had only bought two months ago.
All of this is a tragic scam for working families. What does it take to get some justice here?