The reason is the elaborate mechanism created by the credit reporting industry is inherently flawed. This leads to inaccurate credit reports that lead consumers to paying too much for credit or being denied credit altogether.
The Fair Credit Reporting Act (“FCRA”) uses a standard that requires “maximum possible accuracy”. This high burden was created by Congress in 1970 due to the need for consumer reporting agencies to assemble and evaluate consumer credit and other information on consumers while acting in a fair, impartial manner respectful of a consumer’s right to privacy. Congress recognized that the power to control this information could easily be misused and abused. Credit bureaus do not consider the consumer as their customers. They work for the creditors.