Once upon a time, back in the good o'le days, most people didn't even have to know what their credit score was before making major purchases like a house or car. It wasn't until recently that knowing your credit score was even considered important by financial planners. Now days, not knowing what's on your credit file is tantamount to financial suicide. The recent phenomenon of ID theft has millions of consumers worried about who has access to their credit file and what protections are in place to ensure their file is secure from unauthorized eyes. Even the smart consumer can be duped by phishing scams if the scammer tech savvy and sophisticated enough. According to the White House, the Fair and Accurate Credit Transactions Act of 2003 was supposed to provide consumers, companies, consumer reporting agencies, and regulators with important new tools that expand access to credit and other financial services for all Americans, enhance the accuracy of consumers' financial information, and help fight identity theft. Yet according to the US Public Interest Group (PIRG) Congress did not complete the job of protecting citizens from identity theft or credit bureau mistakes when it enacted the 2003 Fair and Accurate Credit Transactions (FACT) Act. Further, some identity theft protections of the FACT Act are enhanced and improved if states take additional action.
The FACT ACT, or more commonly, FACTA changed a lot how credit reporting agencies and issuers of credit like VISA, MasterCard and many others do business. It expanded the powers that the average consumer has regarding disputing information in their credit file they believe to be inaccurate, outdated or just plain wrong. It also gave consumers the power to dispute directly with the original creditor and required the creditor to prove the debt was the consumers instead of the other way around.
The president has been lobbying for a new federal agency called the Consumer Financial Protection Agency. This information is critical if you want to know more about how the credit industry affects our economy and your bank account. Elizabeth Warren, professor at Harvard and Chair of the Congressional Over site Panel discusses the credit market. In the attached You Tube video, she clearly explains our broken credit market and how it needs reform.
