Report: Equifax Glitch Sent Millions of Wrong Credit Scores to Lenders, Impacted Loan Rates

Equifax provided inaccurate credit scores for millions of Americans seeking loans over a three-week period in the spring, The Wall Street Journal (WSJ) reported Tuesday (Aug. 2).

The credit bureau sent the scores to banks and nonbank lenders in response to people applying for car loans, credit cards and mortgages, according to the report, which was based on interviews with unnamed bank executives and other sources.

The lenders included J.P. Morgan Chase, Wells Fargo and Ally Financial, and the scores were sometimes 20 too high or too low, enough to affect interest rates or lead to applications being declined, the report stated.

The errors occurred between the middle of March and early April, with the company disclosing the mistake to lenders in May, according to the report.

Equifax told WSJ it has since fixed the error, describing it as a “technology coding issue” which didn’t change the information in consumers’ credit reports.

“We have determined that there was no shift in the vast majority of scores during the three-week timeframe of the issue,” Sid Singh, president of Equifax’s information solutions in the U.S., said in a statement. “For those consumers that did experience a score shift, initial analysis indicates that only a small number of them may have received a different credit decision.”

The news comes one week after the Consumer Financial Protection Bureau (CFPB) ordered carmaker Hyundai to pay more than $19 million — the largest Fair Credit Reporting Act case against an auto company — for providing inaccurate information to credit reporting companies.

Read more: CFPB Issues $19M Penalty Against Hyundai Over Credit Reporting

“Hyundai illegally tarnished credit reports for millions of borrowers, including by falsely reporting them to credit reporting companies as being delinquent on their loans and leases,” CFPB Director Rohit Chopra said in a news release. “Loan servicers must be complete and accurate when furnishing information that affects a borrower’s credit report.”