(WNY News Now) After Equifax Information Services, LLC misreported credit scores for tens of thousands of New Yorkers, Attorney General Letitia James of New York announced a $725,000 settlement with the firm.
NEW YORK Equifax Information Services, LLC (Equifax) and New York Attorney General Letitia James reached a settlement today for falsely reporting tens of thousands of New Yorkers’ credit scores to lenders, increasing the cost of loans and other products between March and April 2022. Lenders and insurers priced some of their loans and policies higher than they would have if Equifax had provided accurate credit reports because of a coding error that caused Equifax to fraudulently decrease consumers’ credit ratings. Equifax will pay $725,000 as part of the settlement and put additional protections in place to stop mistakes in the future that increase customer prices.
According to Attorney General James, credit ratings have a big impact on a lot of things in New Yorkers’ life, such the automobiles they can purchase, the homes they can live in, and their capacity to launch a small business. For reliable credit history reporting, consumers rely on credit bureaus such as Equifax. Due to Equifax’s inability to perform its most fundamental function, consumers in New York had to pay more. My office will keep holding businesses responsible when they unjustly increase prices for customers, and this settlement will assist those impacted in receiving compensation.
When applying for certain forms of credit, such as credit cards and auto loans, lenders and customers are forced to allow Equifax to record their credit history because it is one of the three biggest consumer reporting agencies in the country. Equifax found a coding problem in March 2022 that led to it providing lenders with erroneous information for consumer reports during a three-week period. Even though Equifax fixed the problem by April 8, 2022, the firm calculated that over 77,000 New Yorkers’ credit ratings were incorrectly denied, suggesting that Equifax may have given them false information that resulted in a lower credit score.
Equifax informed the lenders and insurers whose borrowers might have been impacted by the coding issue in the summer of 2022. In order to give customers the interest or premium rates that they would have been eligible for had Equifax supplied accurate consumer reports, the lenders and insurers agreed to reimburse Equifax for any interest rate modifications they made. Consequently, scores of insurers and lenders have remedied consumers and received compensation from Equifax to pay for this remediation.
Additionally, dozens of New York customers paid Equifax directly for products that displayed their credit scores throughout the erroneous time period. Those who qualify for restitution will be contacted by the Office of the Attorney General (OAG). As part of the settlement, Equifax must also put consumer protections in place and keep an eye on incident reports that its clients submit at least once a week when they run into problems.
New Yorkers can contact 1 (800) 771-7755 or submit an online complaint to the OAG’s Consumer Frauds and Protection Bureau if they want to report a problem with a credit rating organization.
Under the direction of Deputy Bureau Chief Laura J. Levine and Bureau Chief Jane M. Azia, Assistant Attorney General Glenna Goldis of the Consumer Frauds and Protection Bureau handled this case. First Deputy Attorney General Jennifer Levy is in charge of the Division of Economic Justice, which includes the Consumer Frauds and Protection Bureau. Chief Deputy Attorney General Chris D. Angelo leads the division.