The practice of extending credit dates back to the 19th century when industrialization led to the mass production of expensive
machines that most consumers were unable to afford in a single payment.
Credit reporting agencies were created as credit became more widely used.
The oldest of these reporting bureaus that is still around today is Equifax
(formerly Retail Credit Company, founded in 1899). The agency reported
all kinds of information on consumers to those who paid to see it, including
political activity, criminal convictions, marital problems, and more.
For most of the 20th century, these reports contained only negative information, and consumers
had no rights to look into a file. It wasn’t until 1971, with the
passage of the
Fair Credit Reporting Act, that things began to change.
Why Are There Only Three Large Credit Reporting Agencies?
One of the most important reasons why there are only three major credit
reporting bureaus is that throughout the first part of the 20th century, many companies scattered throughout the country acted independently
due to geography. With an increase in commerce and transportation of goods,
there eventually arose a need for more centrally located information collecting
centers. Larger organizations were formed when many smaller companies
consolidated. The three companies that emerged at the top are Experian,
TransUnion, and Equifax.
Credit Reporting Agencies are Not Government Sanctioned
Interestingly, the agencies’ use of the word “bureau”
is a misnomer, as bureau seems to point to government involvement. However,
it is important to remember that these agencies are not government sanctioned,
nor are they in existence to help consumers. Many people erroneously assume
that if they correct an error through one agency, the mistake will be
fixed at all three through an automatic exchange of information. This
is untrue, as the three agencies operate as separate businesses. A consumer
who wishes to correct an error must file separate dispute claims with
Call a Chicago Consumer Advocate at (312) 313-1613
If you believe that your consumer rights have been violated under the Fair
Credit Reporting Act, it is important that you take action right away.
Errors on your credit report could potentially have harmful effects on
your ability to obtain a loan, open new credit, find a job, and more.
When you seek the assistance of Sulaiman Law Group, LTD, your attorney
fees will be paid by the at-fault creditor, so you can feel confident
that you won’t be held responsible for the financial implications
of someone else’s mistake.
Our firm is well versed in handling cases involving FCRA violations.
To consult with an experienced Chicago consumer lawyer, please
contact us today.