Looking at the site of the EFF (Electronic Frontier Foundation) reveals a huge amount of anxiety for privacy. Their headlines point to various threats for our privacy: Government Surveillance, Google and even browser cookie set by Obama’s media player. But I could not find almost anything about the credit score – the number representing the credit history of a person in the U.S. and in other countries.
Pic by TheTruthAbout (CC)
Whenever you need to rent a car, rent an apartment, sign a contract for gas, electricity, phone, get a loan, get insurance or do anything besides buying in a retail shop, your credit score would be visible to the corporation you are doing business with. While the credit score is just a number, it encapsulates your financial history as supplied by banks, credit card companies and other institutions. This information is shared, and can be easily used without your knowledge or acceptance. I wrote before about the ineffectiveness of credit score as was evident in the current sub-prime crisis. While the objective behind credit score is to eliminate exactly these kind of risks to lenders, it just made them more vulnerable to defaults as they did not employ their own risk assessments methods. While credit score did not stop lenders to give bad loans, it does stop tens on millions of Americans to get services they need in a reasonable price. It allows companies to discriminate between customers. For example, by demanding huge deposits from customers with low credit scores.
Credit score is also a breach of privacy on an enormous scale. The essence of your financial situation, a very private piece of information indeed, is sold and bought freely between companies. While companies have the right to gather some information about their customers, sharing it in such an overwhelming way creates a bias against customers. Customers do not have any control over their credit score. While there is some regulation on how credit data is gathered, there is little regulation on how credit information is used.
So, why does not the EFF take this as an issue? Credit scores are based on large-scale integrated databanks. It is defiantly no more and no less in the digital domain than DRM or browser cookies. I am really not sure.
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