Interesting Equifax History

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Equifax is the oldest and largest consumer credit bureau in existence today. They were originally founded in 1898, 70 years before the creation of TransUnion. Two brothers, Cator and Guy Woolford, created the company. Cator actually got the idea from his grocery business, where he collected customers’ names and evidence of credit worthiness. He then sold that list to other merchants to offset his own business costs.

The success of this tactic led Cator and his attorney brother, Guy, to Atlanta, where they set up what would become one of the most powerful industries in existence today. The Retail Credit Company was born, and local grocers quickly started using the Woolford service, which expanded rapidly. By the early 1900s, the service had expanded from grocers to the insurance industry.

Retail Credit Company continued to grow into one of the largest credit bureaus, by the 1960s having nearly 300 branches in operation. They collected all kinds of consumer data, even rumors about people’s marital lives and childhoods. They were also scrutinized for selling this data to just about anyone who would buy it.

Throughout the 60s Equifax continued to provide credit reporting services, but the majority of their business came from making reports to insurance companies when people applied for new insurance policies, including life, auto, fire, and medical insurance. Almost all major insurance companies were using RCC to get information on the health, habits, morals, finances and vehicle use of potential insures.

Equifax also provided companies with services including investigating insurance claims and making employment reports when people were seeking new jobs. Back in the 60s most of Equifax’s credit work was actually being done by their subsidiary, Retailers Commercial Agency.

In the late 60s, Equifax started to compile their data onto computers, giving many more companies access to this data – if they chose to purchase it. They also continued to buy many more of their smaller competitors, becoming larger and also attracting the attention of the Federal government. They began to earn a bad reputation for selling data to anyone who wanted it, whether or not the data was accurate.

Equifax was gathering details about people including their marital troubles, jobs, school history childhood, sex life, political activates, and more. There was no limit to the kind or amount of data they were collecting.

Some of the information was factual, while large swathes of the rest were completely false; some information was literally no more than rumors. Equifax was even said to reward their employees for finding the most negative information about consumers.

In response, when the US Congress met in 1971 it enacted the Fair Credit Reporting Act. This new law was the first to govern the information credit bureaus and regulate what they were allowed to collect and sell. Equifax was no longer allowed to misrepresent itself when conducting consumer investigations and employees were no longer given bonuses on the basis of the negative information they were collecting, the standard practice in the past.

Retail Credit Division was charged with violating this law a few years later, causing even more government restrictions to be implemented. Scarred with a bad reputation for violations of the new credit laws, the company changed its name to Equifax in 1975 to improve its image.

Throughout the 1980s, Equifax, Experian and TransUnion split up the remaining smaller credit rating agencies between them, adding 104 of those to Equifax’s portfolio. Equifax aggressively grew throughout the US and Canada, and then began growing their commercial business division across the UK.

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