Choicepoint’s Error Rate
Choicepoint regularly claims a very low rate of errors in their reports. In the Consumer Affairs story, “Choicepoint gets a Makeover” [link to http://www.consumeraffairs.com/news04/2006/07/choicepoint_makeover.html no longer works], Choicepoint President Doug “Curling claims his company has a less than 1/10th of 1 percent error rate.”
Now WATE in Knoxville, TN, reports that “Anderson Co. man finds credit report error” [link to http://www.wate.com/Global/story.asp?S=6158276&nav=E8Yv no longer works]:
At his insurance company’s request, ChoicePoint gathered the sum total of Ray’s credit, what he owes for his car, his house, credit cards and other purchases. “It says my grand total of indebtedness is $426,000. That’s about five times what I currently owe,” Ray says.
Some debts Ray paid off showed as though they hadn’t been paid at all. “This was a boat loan” for $50,000, Ray says. “I paid it off over a year ago.”
He also says he went online to ChoicePoint, filed a dispute and spoke with company officials. “My data had not been updated. It was incorrect. My employer was incorrect,” Ray says.
…
ChoicePoint disputes that any errors were made.
See also my May 2005 posting, “Choicepoint Analyses:”
Choicepoint defines an error as a problem between their collector and the report; bad data collected, which we used to call the “garbage in, garbage out” problem, has been defined away.
and finally, don’t forget Deborah Pierce’s work in “Data Aggregators:
A Study of Data Quality and Responsiveness” [link to http://www.privacyactivism.org/docs/DataAggregatorsStudy.html no longer works] :
100% of the reports given out by ChoicePoint had at least one error in them.
The deep trouble here is not that Choicepoint reports are inaccurate (although that seems to be a problem based on impartial reports). The trouble is the accountability disconnect between data collection, aggregation, and use. No one takes responsibility for the decisions that are made based on bad data.
[Update: Just after posting this, I came across “Where’s Waldo? Spotting the Terrorist using Data Broker Information” [link to http://www.anonequity.org/weblog/archives/2007/03/wheres_waldo_spotting_the_terr.php no longer works] :
In its coverage of the issue, the Ottawa Citizen reported that since September 2001, the RCMP has been buying and retaining this kind of personal information from data brokers, and in some instances may have forwarded that information to U.S. law enforcement.
Good thing Ray’s inaccurate data was “only” used to deny him credit.]
[Update 2: Choicepoint’s Chuck Jones disagrees; please see comments.]
Error rates denominators are frequently tailored to the error rate that is desired. For example, Choicepoint could also be using the total number of data fields as denominators in their rate and using individuals as denominators might well throw the error rate into the low teen percents, even with their very convenient definition of what an error is.
As anyone who’s ever had raw access to Choicepoint knows (they have an otherwise nice, SSL-encapsulated XML query system, client certificate mandatory), most credit report are fractional at best and frequently contain information which may be mutually exclusive.
So, to date I’ve not had the “pleasure” of dealing with the US credit reporting agencies but what I would like to know is this: if an institution is distributing inaccurate and disparaging information about me, I tell them so, they continue to do so and as a result I loose out, in what way does that not fit the definition of libel? Knowingly disseminating damaging falsehoods is illegal.
While I’m not usually one to try to enrich the contingency-fee litigators it seems to me that firms like Choicepoint need slapping about with a big fat class-action suit. When it starts to sting they might actually get their act together and take some steps to fix their databases.
Nicko,
My understanding is that the Fair Credit Reporting Act enables companies to report on credit and only be liable for “willful misrepresentation.” You might imagine that the credit agencies will spend large amounts of money to ensure that the definition of “willful misrepresentation” is narrow.
See http://www.epic.org/privacy/financial/fcra.html for the act’s text.
ChoicePoint made no errors in the report in the Tennessee case you cited. When a consumer contacts us about an “error in a ChoicePoint report,” we generally find the error is in the base public record over which ChoicePoint has no control. ChoicePoint consistently advises these consumers how to contact the government agency to correct the error. In compliance with the Fair Credit Reporting Act, ChoicePoint investigates any dispute alleging an error in a ChoicePoint report and, when necessary, makes a revision.
— Chuck Jones, ChoicePoint
Chuck,
I think you’re splitting hairs here. An error appears in a report ‘on your letterhead.’ You collect the information, and to some extent, vouch for it. As I understand it, you use outsourced labor to collect data from paper forms. Errors again ‘not your fault.’ Do you have numbers for how often errors are reported in your reports? How often those reports pan out and eventually result in a correction?
The errors may not be yours, but you make them easy to access.