Question: what ability do most companies have to report something to credit bureaus? I mean, selling my stuff with just Stripe and a DBA, I certainly can't, as far as I know. Credit-card companies themselves certainly can, on the other hand.
Is there a way for "normal" small businesses to affect your credit score based on any kind of non-payment of bill? How do businesses "acquire" this ability? Can anybody just tell a credit score company, "X didn't pay me money, knock their score down"?
I'm just wondering if this is a bluff, which it probably is.
[Edit: Googling it a bit reveals that there are two methods. One is to hand the debt over to a collections agency -- you'll receive less of it, but they'll automatically report to a credit bureau if it's not paid. The other is to become a member of the three main credit organizations, but that involves membership fees etc., so presumably only makes sense if you deal with a lot of consumer billing already where this is a regular occurrence.]
You, and I, could do the same. (hopefully without the fraud)
You can find TechDirt's coverage, which prompted the blog post submitted here with additional legal analysis, at the TechDirt site.
http://www.techdirt.com/articles/20131113/06112425228/online...
The TV news report that got this story rolling:
http://www.kutv.com/news/features/gephardt/stories/vid_474.s...
AFTER EDIT: To answer the question that has come up, which I think is adequately answered by the submitted blog post, companies can report consumers to credit bureaus for nonpayment, including nonpayment of civil judgments. But when those reports are fraudulent, as here, the consumer can also dispute the report, and the consumer should be able to come out with a clean credit record in the end. MANY years ago, my wife ordered a product by mail order, and we discovered the product was defective, and returned it. The company still wanted to bill us, and sent us a letter threatening to report us to a credit agency if we didn't pay. I simply wrote that the product was defective and that we had returned it and we disputed the company's point of view on the company's demand letter, and sent that back by return mail. That was the end of the matter, back in those days. We have a very clean credit history. I speak my mind whenever I think I have been ripped off.
This isn't what happened. See here: http://m.kutv.com/article?id=106632
Specifically: Jen and her husband also disputed the ding with the credit bureaus but because Kleargear.com says the charge is valid the the ding remains.
I've personally experienced what it's like when credit bureaus decide to mistreat you, so I believe this. She likely has no recourse to dispute it short of hiring a lawyer, which is effectively impossible if she happens to be living paycheck-to-paycheck. (It's hard to grok the mental burden placed on you merely to survive, let alone repel an assault from a big, faceless company unless you've been in a situation like "I have to choose between buying groceries or paying for my dying cat's medical treatment," for example.)
If the reported version of events are true, then what this company did to her is reprehensible and should be punished. Otherwise it will set a dire precedent for other companies to try this in the future.
I followed instructions from this site: http://whychat.5u.com/
No lawyer is needed if you just follow the right procedure and are ready to go to small claims court.
I have the strong suspicion that this has the potential to get much uglier and more bizarre. Going after this woman three years after she left her comment is not something that a sane company/legal representative in a good position decides to do.
Jen Palmer is not facing a $3,500 fine any more than I'm "facing" the threat of being struck by a meteor on my birthday. She'll pay this horrible company a dime the day Eskimos need to worry about tigers, and I actually can think of a good analogy.
This title seems intended to gin up outrage where there should be none. To be sure, I'm outraged at this company's terrible ethics. But in this case our legal system actually works. News at nine.
To be clear, I hadn't missed any bills. I just hadn't used much credit, so they had no data by which to calculate a score for me. Therefore AT&T completely refused to do business with me.
It's crazy how much power these institutions have over your life. That this company was able to ruin her credit for posting a negative review is a huge deal. If they're not penalized for this, then this will set a terrible precedent.
That does sounds like fraud (and/or extortion). It seems to me that, as stated in TFA, the credit bureaus won't perpetuate any fraud they are aware of. I doubt that Jen's credit will be "destroyed" at the end of this affair.
> however the threat and consequence is very real.
I'll grant the "threat" is real. Someone is certainly threatening this poor woman. As far as "consequences" go? No, there won't be any.
This little stunt of theirs should cost them a lot of money.
That's some great doublespeak right there.
Clearly, in this case, KlearGear are in the wrong, but I also think that there are cases where legitimate businesses have been seriously damaged by competitors, or just difficult customers writing unfair bad reviews.
Unfortunately the only solution to this I can think of would be a review of reviewers, which would just confound the problem.
This is a big problem for small businesses and people alike, but the actual solution to this is the opposite of what most people's first instincts would be. Ironically, it's the existence of laws against libel/slander that makes fake reviews and false negative content online such a big deal for people going forward.
Because these laws exist, people are conditioned to believe that most of what they read online is true because otherwise legal action would be taken and it would get removed. But few people and small companies have the resources to track down every false review or fake negative comment and find out who did it and make legal challenges.
If you're an average small business, you don't have an easy way to mount a serious challenge against a site like RipOffReport when an unknown competitor starts writing nasty fake reviews about you online that you never shipped a product or whatever. If you're an average person, you have very little recourse if somebody goes and falsely writes that you have an STD on a site like Dirtyphonebook or whatever. People and companies with large amounts of resources are protected by libel/slander laws, but the average person or small company isn't really.
In a society with no laws against libel and slander, people would be a lot more skeptical about the veracity of negative comments that they see online and do a lot more research before buying a product or believing some negative comment was false.
We can talk a lot about better reviews and reviews of reviews but all of these are susceptible to the same issues.
I will take a large plurality as reliable, and someone able to write in the correct tone could certainly mislead me (that is, I will look at an individual review on its apparent merits), but I sure don't expect a couple of good or bad reviews to mean anything.
Also, the encyclopedia I ordered did not contain any murder mysteries, one star because I can't put no stars.
And that's the key phrase in this entire thing. For everyone who says, "oh, they're in the right, they should hire an attorney", they're either more naturally litigious than I am or have never actually had to hire an attorney and prosecute a case in court. The name of the game is intimidation and harassment. KlearGear is absolutely betting that their customers don't have the resources to combat their meritless lawsuits.
I assume this is how Yelp and others do it.
If me and my co-authors cultivate a critical mass of reviewers, respond to the bad reviews that genuinely misunderstood something, and have enough traffic on the pages to generate enough "useful" scores on reviews, it all works out in the end.
If anyone's interested in working on open source solutions to this problem, feel free to email me. It's kind of my thing:)
We never did finish it but I have lots of code, docs, ideas and research from that time and I'd be happy to help with your idea if you pursue it.
Their ridiculous non-disparagement clause purports to apply to all forms of communication (or perhaps to all forms of communication that are "published", depending on how you read the thing). In this particular case, they are trying to enforce it against an online review, but that's an irrelevant detail. The title here emphasizes that irrelevant detail too much.
Talk about credit ratings -- their Dun & Bradstreet likely won't look so hot in a couple months.
Which I find 100% delightful and just. Reap what you sow, KlearGear. Thou art sleazy, scummy f-wads. Happy holidays!
