Sean Erenstoft Whistleblows on Credit Reporting Agencies

An On-Going Scandal Affecting Your Life — Get Ahead of the Curve

Civil Rights advocate, Sean Erenstoft has trained his attention on California’s Attorney General in an attempt to draw attention to an oft-ignored and on-going scandal involving the credit reporting industry that affects more than 200 million consumers.

“Don’t ignore your credit score!” The three credit-reporting agencies (CRAs) (Equifax, Experian and TransUnion) collect and provide credit information on more than 200 million consumers in the United States. Credit reports provided by the CRAs are used to assign numerical ratings called “credit scores,” which help lenders determine whether they should grant loans to consumers and at what interest rates.  Many people do not know about the credit scoring system—much less their credit score—until they attempt to buy a home, take out a loan to start a business or make a major purchase.  A credit score is usually a three-digit number that lenders use to help them decide whether you get a mortgage, a credit card or some other line of credit, and the interest rate you are charged for this credit. The score is a picture of you as a credit risk to the lender at the time of your application.

“Most people ignore their score until it’s too late.” Sean Erenstoft reports that a quarter of credit reports have a mistake in them; and 5% have serious mistakes including cases of mistaken identity. If you are in that statistic, you may have to fight for years to prove your not the person whose credit is being cited. Errors can be fatal to your attempt to lease or finance a car or obtain a mortgage. And more and more, employers are checking credit reports before hiring. “The problem is that you don’t typically find out until you are vying for credit at the time of purchase. That’s simply too late.”

Los Angeles lawyer, Sean Erenstoft has appealed to California’s Attorney General, Kamala Harris to take up the cause to provide immediate relief to consumers. For one, Sean Erenstoft promotes disallowing medical debts to be put on consumer’s credit reports until after a mandatory waiting period to ensure that insurance payments/disputes are amply addressed. Also, paid debts should be immediately reflected in any report. “This will afford accurate reporting in an era of immediate credit worthiness.”

Sean Erenstoft exclaims that “there is no reason why CRAs should be able to collect our data, mess it up and then charge us to review it and delay correcting it.” Simply monitoring one’s own credit is insufficient.  Federal law requires that consumers only have access to one free credit report per year.  But, Sean Erenstoft notes, “In the modern credit era, yearly reviews of your credit don’t suffice.  Yearly reviews are an antiquated approach to solving a pervasive problem.”

Sean Erenstoft’s Solution: Consumers should have continual access to their credit data (like on social media) to enable them to make timely and meaningful corrections to their credit report.  The answer is unlimited free access for all consumers and a transparent system that better promotes accuracy.  Sean Erenstoft has also promoted the idea of a “credit-tzar” to afford consumers an immediate complaint-resolution mechanism that effectively places the burden of proof on credit-reporters to establish the bona fides of their statistics.

Sean Erenstoft is a widely recognized mediation/arbitration advocate and believes that credit arbitration can be efficiently established at the expense of the CRA’s.  “Given the risk of error in credit reporting, CRA’s should be caused to purchase “insurance” to afford consumers instant credit resolution.”  “Doctors, lawyers, and other professions are required to purchase insurance to offset malpractice. . . so should the CRAs.”  Join Sean Erenstoft and his appeal to California’s Attorney General, Kamela Harris to effect this change.  Re-tweet this article to:  @kamalaharris