Investing.com -- Stocks in the three largest credit agencies in the United States were mixed at Monday's close after New York attorney general Eric Schneiderman reached an agreement with the agencies on how they collect and report consumer information.
Experian, Equifax and Transunion agreed on Monday to increase protections for consumers facing credit report errors and to enact procedures which could improve the accuracy of the credit reports. The credit-rating agencies (CRAs) maintain consumer credit information on approximately 200 million customers nationwide.
“Credit reports touch every part of our lives," Schneiderman said. "They affect whether we can obtain a credit card, take out a college loan, rent an apartment, or buy a car – and sometimes even whether we can get jobs."
"The nation’s largest reporting agencies have a responsibility to investigate and correct errors on consumers’ credit reports. This agreement will reform the entire industry and provide vital protections for millions of consumers across the country.”
The agreement also seeks to improve the dispute resolution process, institute reforms on the ratings process for medical debt collection and provide additional free annual credit reports to consumers. As part of the settlement, the CRAs agreed to establish a 180-day waiting period before medical debt is calculated into a consumer's credit rating. The waiting period provides an ample amount of time for a consumer to dispute outstanding medical charges, Schneiderman said.
Equifax Inc (NYSE:EFX), an Atlanta-based company which was founded in 1899, dropped 0.44% or 0.41 to 92.97. Equifax, which is the oldest of the three CRAs, has more than 7,000 employees in 14 countries and maintains credit information on more than 400 million customers throughout the world.
Experian Plc (LONDON:EXPN), which is headquartered in Dublin and has U.S. offices in Costa Mesa, Calif., dropped 1.96% or 23.27 to 1,163.27 on Monday on the London Stock Exchange. In August, 2005, Experian agreed to a settlement with the U.S. Federal Trade Commission over allegations that the company failed to properly disclose actions which resulted in automatically enrolling customers in a credit-monitoring program that cost upwards of $75 per consumer.
Transunion Corp., the third-largest credit bureau in the United States, was acquired by Goldman Sachs Capital Partners and Advent International in 2012. Goldman Sachs Group Inc (NYSE:GS) gained 1.02 or 0.55% to 187.93 on Monday.
A 2012 study from the Federal Trade Commission found that 26% of participants identified at least one "material error" in their credit reports. Furthermore, the study found that 13% of respondents improved their credit score after reporting a dispute to their CRA.