DEBITS IN THE STRAIGHT WORLD

The Bizarro World of Credit Agencies

NEW YORK -- In any other line of business, these vicious tyrants would be driven into bankruptcy, their buildings razed, the soil where they stood salted with radium so that nothing would grow there for 10,000 years, their stupid, mean employees dragged out of town by angry mobs. If any individual exercised such consistently callous disregard for his fellow citizens, to the extreme of ruining their lives beyond repair, he'd be jailed for life in a leper colony. Yet for credit agencies, business is booming, and no one in government seems to care about what they're doing to ordinary Americans.

Most people come into contact with these incompetent outfits when they're first turned down for a credit card. The rejection letter allows you to get a copy of your credit report for free, but what you eventually receive hardly ever bears any similarity to your actual credit history.

Addresses, birthdates and employer information, including salaries, are absurdly out-of-date or completely wrong. Payments that were always made promptly are listed as delinquent, yet such obvious black marks as negative court judgments are often missing. My latest credit report lists me as working for a firm I've never even heard of at a salary a 16-year-old kid would find hard to handle. There's a delinquent debt for a book-finding service I've never used or heard rumors about. And there're some troubles with my alma mater's dorm system that date back to A Flock of Seagulls' dominance over the pop charts -- remember, this stuff is supposed to disappear after seven years.

On several occasions I have availed myself of my legally protected right to amend my credit report with information that elevates me from fiscal criminal to model consumer. When nothing happens, I call the credit agency. The conversation goes something like this:

Me: I was never late paying that bill. I paid it on time. And I've sent you a letter from the creditor saying so. Why is there a delinquency still listed?

Woman with Piscataway, N.J., accent: If you'd paid your obligations in a timely manner, you wouldn't be in the trouble you're in.

Me: But I do pay on time and I did pay on time, and I sent you the proof that you've made a mistake about me not paying on time, and now you're not fixing it.

Woman with Piscataway, N.J., accent: The sooner you become responsible, the better your life will become.

Me: But -- (line disconnects due to sun-spot activity).

The trouble is, credit agencies collect data in a haphazard, inconsistent manner. They correlate civil court records and match them to individuals by Social Security number, which means that two transposed digits can ruin you for something you never did wrong. They rely on your old credit card applications, old phone directories and old public records. They get information on you from everyone except the one person who knows you best: you. The system is so perfectly designed to fail that an accurate report could only result from a remarkable series of errors.

Despite the frivolous way the agencies handle it, credit is serious business. Since most people have negative comments on their records that are unfair or inaccurate, they're being wrongfully denied credit cards, car loans and home mortgages. At its extreme, people without a credit card to their name can face issues of life and death: Do you want to break down in the middle of the Nevada desert or become ill in a foreign country without a Visa card? Presumably it's also true that deadbeats are mistakenly getting credit they don't deserve, but I admit that that idea hardly causes me any pain.

Ideally credit agencies with high rates of mistakes and unethical behavior would be forced out of business by government regulators. In the meantime, there is some good news for consumers. This week a Florida appeals court made it easier for consumers to sue for "credit slander." Truck company owner Michael Musto sued the BellSouth telephone company for reporting to a credit agency that he'd failed to pay them $680 because one of his trucks accidentally pulled down a phone line in 1996. Musto refused to pay, claiming that the line hung below county height regulations. BellSouth tried to get out of the suit by citing the expiration of a two-year statute of limitations, but the appeals court said that each time the credit bureau issued a bad credit report, the statue of limitations began anew.

Michele McNichol, attorney for BellSouth, said that the decision means that companies and credit bureaus could be liable virtually forever for credit slander. "I think it has significant implications," she said.

We can only hope she's right.

(Ted Rall, a cartoonist and columnist for Universal Press Syndicate, is author of "Revenge of the Latchkey Kids.")