Equifax gave wrong credit scores to millions of consumers

In certain cases, the errors were large enough — the difference was at least 25 points for about 300,000 consumers — that some potential borrowers were wrongly denied credit, the company said in a statement.

Shares (EFX) fell about 2% on the report Tuesday and fell nearly 5% and shortly after the open Wednesday.

The issue, the company said, arose because of a “coding issue” when making a change to one of Equifax’s servers, which said the issue “existed over a period of a few weeks.” [and] resulted in the possible miscalculation” of credit scores.

While Equifax didn’t specify dates or numbers, a June 1 warning from housing agency Freddie Mac said to its clients that Equifax told the agency that about 12% of all credit scores released from March 17 to April 6 may have been incorrect.

Equifax wrote that “there was no shift in the vast majority of scores” and that “credit reports were not affected”. But the company declined to comment to CNN Business about how people can know if they were among those whose credit scores were reported incorrectly — and what story they might have if they got loans at a higher rate or refused a loan outright because of the snafu .

Equifax released its statement later Tuesday, hours after the Wall Street Journal published a report on the errors. The trade publication National Mortgage Professional had reported in May that Equifax was warning lenders about the possibility of incorrect scores, and the company released a statement to the magazine at the time acknowledging the technology-based error.

Tuesday’s revelation about the scoring errors comes just after Equifax said the board voted to give CEO Mark Begor a $25 million retention bonus package.

Last Friday’s regulatory filing announcing the bonus said the board believes Boger is “uniquely qualified to continue leading the company through the final stages of our $1.5 billion technology transformation.”

Equifax tracks the credit histories of millions of borrowers — nearly all Americans — and sells that information to banks and other lenders. As one of only three major credit reporting companies, Equifax plays an outrageous role in the credit scoring business, helping lenders determine interest rates for borrowers or denying borrowers seeking mortgages, auto loans, or credit cards.

This is not the first data problem for Equifax. In 2017, the company disclosed that the personal information of nearly 150 million people had been compromised. The company eventually reached a deal to pay up to $700 million to state and federal regulators to settle investigations into the incident, the largest settlement ever paid for a data breach.

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