Finally, free credit reports for all

Bob Sullivan Technology correspondent • Profile • E-mail

Thursday is free-credit-reports-for-everyone day.

Beginning Sept. 1, all U.S. adults will be able to request one free copy of their credit report from each of the nation's three credit bureaus.  Consumers were granted the free reports as part of the Fair and Accurate Transaction Act, passed by Congress in December 2003.

The site consumers visit to obtain their free report, AnnualCreditReport.com, went live back on Dec. 1, but the credit bureaus engaged in a rolling release of the reports from West to East -- the Northeast region was the last in line.  So on Thursday, New Yorkers, Washingtonians, Bostonians, and others in the Northeast get their first crack at the Web site. 

Consumers can also call a toll-free number, 1-877-322-8228, to get their report, or they can send for it via snail mail.

The Web site is operated by the three credit bureaus -- Equifax, Experian and Trans Union -- which haven't released data on how many consumers have visited the site.  Last December, there were temporary outages at AnnualCreditReport.com, but since then, thing have run fairly smoothly, said Peggy Tui, who monitors the site for the Federal Trade Commission.

"There have been some glitches, but we think all in all it's gone fairly well," Tui said.  "Sept. 1 will be an important test."

FreeCreditReport.com settlement
Probably the biggest glitch has been the site's name.  While there's only one place for consumers to get their Congressionally-mandated free credit report -- AnnualCreditReport.com -- there are over 100 Web sites with similar-sounding names. Most attempt to sell consumers subscription services that offer repeated peeks at their credit report.

In August, Experian settled charges with the Federal Trade Commission that it misled consumers with its FreeCreditReport.com site, which sells credit monitoring services.  While the firm admitted no wrongdoing, it agreed to refund some consumers and pay a $950,000 fine. The settlement also included Experian's similar Web site, ConsumerInfo.com.

Norma Garcia, a spokeswoman for Consumers Union, said the three credit bureaus who sell reports may have confused consumers by offering services with similar names, hampering efforts to get attention for AnnualCreditReport.com

"The bureaus have done a good job of capturing consumers wandering around trying to find their free credit report," she said. "But they ...haven't done a good job of educating consumers."

Another glitch in free credit report system: In a year dominated by news of privacy data leaks -- the Identity Theft Resource Center says there have been 100 publicly disclosed breeches --  consumers don't seem to know much about AnnualCreditReport.com, or don't think it provides much help.

In a recent survey, Gartner Inc.'s Avivah Litan found that about half those polled either weren’t aware they were entitled to a free credit report or considered them “not effective” in fighting ID theft.

Only 13 percent of those surveyed who had heard of the reports described them as "very effective."

"The free credit report thing is basically a farce. It only tells you very specific information about your situation at a point in time," Litan said.

Mari Frank, a lawyer who frequently represents ID theft victims, said she wasn't surprised that free credit reports ranked low in consumers' minds.

"They are not really a prevention tool," she said. "It just allows you to see and question whether something is either in error or fraudulent (after the fact).  It's not going to prevent ID theft."

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