Credit Damage
Consumers Struggle to Untangle Reports

The story below focuses on the horrors for victims of fraud having to deal with credit reporting bureaus that drag its feet removing false information on your record. Equally appalling is that the same reporting bureaus lag when it comes to correcting their own mistakes from improper data entry.

Credit reporting bureaus attitude is its not their problem. Victims find filing criminal complaints net them nothing.

Credit Agencies Lag on Errors, Fraud

By Beth Healy
Boston Globe Staff
December 28, 2006


BRIDGEWATER -- Eric W. Carroll's credit report says he has a home in Florida, a wife named Katrina, and a pile of unpaid bills.

He first learned this when a debt collector called him in 2002, dialing his apartment in Bridgewater, yet asking for an Eric W. Carroll from Avon Park, Fla. Carroll insisted there was some mistake: He was not married, and he had never lived in Florida.

Nearly five years later, collectors are still hounding the wrong Eric Carroll.

The details of his financial life have been hopelessly interwoven with those of another man by the same name, a man who appears, in credit reports, to have stiffed more than two dozen creditors, from banks to utilities, and has a history of bouncing checks.

As a result, the Massachusetts Eric Carroll, living in Newton with his fiancee Nancy and their new baby, can't get a mortgage, can't rent an apartment in his own name, and last July could not buy an engagement ring without his father's help.

"I felt this big," said Carroll, 29, pinching together his thumb and forefinger. "It literally ruins your life."

Carroll was one of scores who contacted the Globe after a Spotlight Team report this summer on debt collection abuses. Many felt victimized by the power and ruthless tactics of debt collectors. But Carroll and others complained of another maddening aspect of the system: The glacial and ineffectual response of the three giant keepers of consumer credit records -- Experian, Equifax, and TransUnion -- to remove any errors in their files, even those that appear as a result from fraud.

Until the errors are corrected, debt collectors will try again and again to squeeze out a payment. Some back off when they find they're after the wrong consumer, but often, another firm buys the account and goes after the likes of Carroll again.

The local, state, and federal law enforcement response to complaints of identity fraud is similarly passive, despite the huge volume of complaints -- 255,000 last year to the Federal Trade Commission alone. Consumers are left to fend for themselves -- a recipe for frustration and worse, as Carroll has found.

"This kid's trying to start a life for himself," said Leo "Buddy" Carroll, Eric's father, who has devoted hundreds of hours to fielding calls from collectors on his son's behalf, and helping him dispute items on his credit report. "It's not fair."

Was this identity theft, or a data debacle? Either way, Eric Carroll's credit was ruined. And the Carrolls couldn't get to the bottom of the case, nor could they get help in solving it.

They quickly suspected that the real deadbeat was the Carroll from Florida, whose address appeared on the Massachusetts Carroll's credit reports. The Florida man shares the middle initial W, though it stands for Wayne, not Winslow. He is almost the same age, at 31, and shows up on numerous accounts with the Newton man's Social Security number.

But all that was not enough to untangle the mess -- or even spark an investigation by the credit bureaus. The information was a conversation stopper with debt collectors, who hung up upon hearing they had the "wrong" Eric Carroll.

Two creditors, Dell Computer and Sprint, looked into the matter after Carroll complained, and wrote him letters saying they'd found evidence of fraud and that he was not responsible for the bills. But neither company, as a practice, passes such findings on to law enforcement.

The credit bureaus, in turn, generally expect consumers to dispute incorrect items on their credit reports one by one, over the Internet, and to patiently wait 30 days for each item to be checked out. When they find evidence of fraud, the credit bureaus will flag or temporarily "freeze" a consumer's record, to prevent banks and others from mistakenly extending credit to a person they suspect of fraud. But they are under no legal obligation to pass the information on to authorities.

David Rubinger , a spokesman for Equifax Inc. , said the company does what it can to help people deal with identity theft, but ultimately, "The consumer needs to help themselves."

The credit bureaus do urge consumers to file police reports. But that step usually accomplishes little. In Carroll's case, the Bridgewater Police Department took his report of alleged identity theft and "went the extra mile," according to Sergeant Christopher Delmonte, faxing the report to the Highlands County Sheriff's Office in Florida. But that's as far as they could take it, he said.

Even when the police do pass along a tip, it can die quickly. Leo Carroll recalls speaking with a deputy sheriff in Highlands County, Robert Campbell, to follow up. He said Campbell told him Eric's was a case of mistaken identity.

Campbell, in an interview with the Globe, said he recalled going to see an Eric W. Carroll, who was then living in Lake Placid, Fla. He said he determined that the matter was a data error, not identity fraud, although he could not remember how he came to that conclusion. The county could not locate any record of the investigation.

A little further digging turned up an arrest record for the Florida-based Eric W. Carroll that included charges of defrauding several people on eBay in 2004.

In a telephone interview from Florida, Carroll said he'd had longtime financial problems. He got into trouble on eBay, he said, when he started a business selling music amplifiers but ran short of cash -- taking orders from people that he couldn't fulfill. Records show the charges against him were dropped.

"I was able to get everybody their money back," Eric Wayne Carroll said.

He denied having used the Social Security number of Eric Carroll in Massachusetts, and said he had no knowledge of their intertwined identities. He did not respond to subsequent calls and e-mails from the Globe.

In Norwell, Susan and David Litchfield figured they, too, were hot on the trail of an identity thief. While battling the credit bureaus for six years to erase numerous debts on their record that were incurred by a David J. Leighton of Tampa, the Litchfields obtained a copy of one credit card agreement they had allegedly signed. On the form, which the Globe reviewed, is what appears to be Leighton's signature, along with David M. Litchfield's Social Security number neatly penned in.

But that did not interest the credit bureaus. Susan Litchfield wrote to the three companies, telling them of the apparent fraud, to no avail. She said she filed a complaint with the FTC, and she called the FBI and US Secret Service. She has disputed more than a dozen items on the report, including a Tampa child support enforcement order that last December totaled $19,060, according to an Experian credit report.

In 2004, the Litchfields went to the Norwell police. The department forwarded the matter to the Tampa police, who responded that the case "was investigated by our Department and determined to be unfounded." A Tampa detective wrote that the accounts had been mixed up because the two men have nearly the same Social Security number, except for the last digit.

But that didn't explain Litchfield's Social Security number appearing on the credit application with Leighton's name, address, and apparent signature.

Leighton, reached by telephone, said he had heard from the Litchfields years ago and thought the issue was resolved. He said he had no memory of signing for the Mastercard application on which his name appears and said, "The only Social Security number I've used is my own." He did not respond to numerous requests to see a copy of his signature.

The ordeal has been costly to the Litchfields, who first learned of the problem when they were rejected for a student loan for the younger of their two daughters. Sears and Citibank have raised the Litchfields' credit card interest rates, as a penalty for the Leighton items on their credit report.

Also, when they recently went to refinance their home equity loan, the bank where Susan Litchfield has done business her entire life, Scituate Federal Savings Bank, at first declined them over the credit report.

"I just sat here and cried," she said. After she explained they were victims of fraud, the bank did extend the loan -- but not on the best terms the Litchfields were used to.

After an inquiry by the Globe, TransUnion, one of the credit bureaus, reviewed Litchfield's case. On Dec. 15, the Chicago firm's director of consumer solutions and fraud victim assistance, Steve Reger, told Susan Litchfield that the company had found evidence of fraud and promised to wipe the record clean.

In an interview, Reger said, "Mr. Leighton was using Mr. Litchfield's Social Security number."

Meanwhile, the Carrolls are still fighting for justice for Eric.

In response to Globe questions, Experian recently asked several creditors, including Wachovia Bank, to review their files on Eric W. Carroll. Wachovia then wrote to the Carrolls, asserting that its records on Eric were correct, attaching a copy of the credit card contract it said belonged to him. It was signed by Katrina S. Carroll -- Lake Placid, Fla.

It would take another round of calls by the Carrolls, and a bank investigation, to get Wachovia to back down. The new information from creditors has led Experian, too, to a new conclusion; the firm now says Carroll's file shows evidence of identity theft.

Beth Healy can be reached at bhealy@globe.com.

To read other articles by the Boston Globe about debt collection abuses, go to their web site for the excellent series.

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