We’ve all heard of horror stories of someone stealing a credit card or hijacking your identity online to “party like it’s 1999” and leaving you with the bill. It’s become a cultural cliche and even popularized in TV sitcoms and commercials.
But it’s anything but funny when a scam is played on you. So prepare to protect yourself and your credit.
Credit is vital in this economy. We depend on it to get us through the day. It’s part of our identity (and the credit reporting bureaus know it and charge lots of money to sell soci-economic demographic data to marketers keen on target marketing.)
And in a time when banks and lenders of all sorts are skittish about lending and getting burned, it’s all the more important to maintain a good (if not great) credit score.
The difference between a credit offer and interest rate for someone with a 780+ FICO score and someone with “only” a 700 can be 0.25% on a mortgage, maybe more for an auto loan. Doesn’t sound like much but believe me when you’re making that payment each month you’ll appreciate the lower payment resulting from the reward you get for great credit.
This brings me to my tale of woe for today.
Check Your Credit Reports Regularly
I’m kind of obsessive about maintaining my credit and paying bills on time. I’m no stranger to disputing charges. I check my credit report regularly. If you don’t you should. And you can do it for free. Just go to www.annualcreditreport.com which is a site offered in conjunction with the Federal Trade Commission.
The FTC has set up the site to help consumers get a copy of their credit report for free each year. Since there are three main credit bureaus to which virtually all creditors report: Trans Union, Experian and Equifax. You can get a free report from each of these reporting agencies.
Once you log in and verify yourself you can choose which bureaus to compile your report. The best tip I can suggest is to stagger your requests. Order one report from one bureau and then order another free report from a different bureau three months later. And then repeat three months later with the third and final bureau.
Why go through the trouble? Well, each bureau will more than likely have the same information as the others. Not always but most times. So you can basically monitor your credit for free by staggering your requests throughout the year.
So while there are services out there offering “free” credit monitoring services (and they have really catchy jiggles), you can do it yourself for free.
The Robo-Call That Started It All
So what happened to me? Well I started getting “robo-calls” in December from a “Kelly Smith” of ER Solutions located in Renton, Washington. Kelly had a wonderful British accent. Her sister must reside as one of the voices in my car’s GPS. Kelly asked me to call her.
Now, I’m a married guy (and Spencer’s dad if you can’t tell in the pictures posted here) but it’s certainly flattering to have a woman with a sultry voice ask you to call her even if it is just a business call.
So I call the young lass. While I don’t get her on the phone, I do find out that ER Solutions is a nationwide collection agency. I’m told this by the message I receive from the robot attendant when I call. While not pleasant, I’m sort of used to calling collection agencies. In my past life I used to own and run a credit reporting agency that produced credit reports used in mortgage lending or property rentals. So calling these kinds of companies was a necessary chore every now and again to verify the legitimacy of something that appeared on a consumer’s raw credit data file.
But in this case, I’m calling for me. Now once I get past the shock that I’m calling a collection agency on an account that supposedly belongs to me, I try going through the frustrating voice mail tree. Ultimately, I get to a point where I’m asked to leave a message but before I can another message tells me that the “mailbox is full.”
Not one to be stonewalled, I do my best to find out more about this company. I search online and find another phone number. I call it with the same result. I do this over the course of a couple of days. But despite the time of day or day of week I am unable to ever reach a live attendant or leave a message.
I do more research. I check the government records at the Secretary of State’s office for my state (Massachusetts) and the corporate HQ (Washington). I file complaints with the Washington Office of the Attorney General and with my state’s regulator for collection agencies, the Massachusetts Division of Banks. I also go online to the FTC and use their online complaint process at www.FTC.gov. I send a certified letter to the company demanding that they verify the debt per my rights under the law.
In my research I find several websites that have posts from many irate consumers who have had dealings with this company. All of them report various kinds of abuse. Many show how seedy collection agencies try to scam consumers by trying to collect on fictitious charges, using abusive tactics in their calls and ignoring any inbound contact with the consumer. You can check out the consumer reports on this company online at Ripoff Reports, Complaints Board and Complaints.com.
In many cases the stories sound like mine. It’s either a fictitious debt or a debt that was in dispute with a creditor that should not have been turned over. But being big faceless corporations that they are, one hand doesn’t know what the other is doing.
Without any help from my British friend at ER Solutions, I tracked down the problem. Since the folks at ER Solutions never answer their phones and never provided any account reference in their call, I checked my free credit report that I got from www.AnnualCreditReport.com. I found a cryptic reference to Verizon Wireless, my cell phone carrier.
One Computer Glitch Leads to Another
After a long and frustrating runaround I found the problem. I had transferred my old individual wireless account to a new family plan account with Verizon. This was supposed to be seamless but it was apparently not.
Despite paying through Verizon’s One Bill bundled service, the wireless side of Verizon had a wrong address for me. While they had no problem confirming where to send my new phone, they didn’t bother to correct an incorrect entry in their billing system tied to an address I haven’t had for more than 8 years. While I had been told that the old account would be merged with the new account, the faceless phone rep was very wrong.
So while the family plan account was being paid in full each month, a statement for the old account with a charge for the new phone I bought was being mailed to a defunct address. And even though I would call and speak with customer service from time to time no one bothered to mention that there was anything outstanding despite my inquiries.
Protect yourself by vigilantly monitoring your credit report and disputing erroneous and false information quickly. Don’t simply roll over and pay the amount without verification. Often when someone is going through a loan process an underwriter will require that old debts get paid off before closing on the loan. While good for the lender this is bad for you and your credit score. Since credit scores are skewed toward the most current activity, paying on a disputed amount will likely result in a hit to your score as the creditor or collection agency updates the record with the payment activity.
As the veteran cop on Hill Street Blues would say after morning roll call, “Be careful out there.”