Beyond Equifax, Experian and TransUnion -- aka the "Big Three" major credit-reporting agencies -- are these so-called "fourth bureaus," that tend to track consumers that lie outside of the mainstream financial world. As the Post describes them: "students, immigrants or low-income consumers who do not qualify for traditional loans or choose not to use them. Instead, they rely on a makeshift system of payday lenders, check cashers and prepaid cards."
The Post goes on to highlight these following "fourth party" data collectors; I've bolded a few sections for emphasis:
LexisNexis, whose parent company bought ChoicePoint three years ago, handles background checks, tax assessments and criminal histories. Bounced checks can be tracked through Chex Systems, TeleCheck or SCAN. Payday lenders report to a company called Teletrack. Alliant Data compiles information on so-called "installment payments," industry jargon for recurring monthly fees such as gym memberships.
The National Communications, Telecom and Utilities Exchange collects account information for 63 of that industry's largest firms -- although the group's director won't specify which ones. Members use the data to decide who to approve for new accounts and the size of a security deposit.What's really scary is that the information collected by these agencies is not always correct -- and consumers apparently can do little to fight it.
With the Big Three, consumers are protected by the Fair Credit Reporting Act. And while data from Equifax, Experian and TransUnion are not always accurate, consumers can dispute and usually clear their reports of false information with proper documentation. Consumers are also entitled to a free copy of their credit reports -- one a year from each of the three major agencies, via annualcreditreport.com.
But these alternative data clearinghouses aren't covered by the same rules. LexisNexis, for example, reportedly only makes changes to less than 0.2 percent of background reports because of consumer complaints. And according to the Post, the bureaus can charge as much as $11 to provide consumers access to their own records.
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