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Jeffery P. Naimon quoted in American Banker article, “Bill to enhance poor credit scores will backfire, critics say”

American Banker

Jeffrey P. Naimon

Jeffery P. Naimon was quoted on July 30, 2018 in an American Banker article, “Bill to enhance poor credit scores will backfire, critics say,” which discussed the legislation to allow consumers to include monthly billing data to enhance their credit scores, and whether this legislation will negatively affect the consumers. The article stated, “The measure, which passed the House earlier this month and is authored by Rep. Keith Ellison, D-Minn., is intended to allow consumers to benefit from positive information about lease, telecommunications and utility payments in their credit reports. An identical version has been introduced by Sens. Tim Scott, R-S.C., and Joe Manchin, D-W.Va., in the upper chamber. But critics warn that Ellison's bill could open a Pandora's box. Not only will it be difficult for landlords and service providers to furnish the data, they say, but observers also note it could highlight negative information — such as late payments — that could hurt a consumer's credit standing, particularly consumers with a thin credit file. The legislation would give consumers who are currently ‘credit invisible’ the opportunity to have a credit history that includes their telecommunications and utilities payment data. But legal experts say the inclusion of such data could result in those consumers actually having low credit scores.”

Naimon added, “Because the data provision will not be universal, and because many consumers’ payment histories may not be pristine, it is possible that the bill may not open up access to credit in the ways that the bill’s authors are hoping.” He also noted the difficulty smaller landlords and telecommunications companies might have in providing the data -- “You might find that the largest cellphone carriers and landlords would already have sufficient data integrity resources and investment that they would be able and willing to furnish data to the consumer reporting agencies, but smaller landlords and less sophisticated carriers may not be willing to furnish.”

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