A Wall Street Journal report dives into illegitimate claims of identity theft facilitated by credit repair companies under the guise to help consumers.

4 minute read

Illegitimate claims of identity theft from credit repair companies that temporarily improve consumers’ credit scores and credit reports are an increasing issue for lenders, the credit reporting system, regulators and consumers, according to a report from The Wall Street Journal (a subscription may be required).

The Federal Trade Commission launched a site, identitytheft.gov, in 2016 for consumers to file claims of fraudulent accounts on their credit report and send them to the credit reporting agencies (CRAs) Equifax, TransUnion and Experian.

According to The Wall Street Journal report, the FTC’s site provided consumers more recourse for identity theft claims than filing a police report.

The FTC saw approximately 588,000 cases of identity theft related to credit cards, auto loans and other financing in 2021, including legitimate and illegitimate reports, according to the article.

In most cases, CRAs have to remove the information that is the subject of an identity theft or other fraudulent claim while it is reviewed, then can reinstate it if it is found to be a legitimate account.

However, CRA industry representatives said that “unscrupulous credit-repair companies are a bigger portion of the problem,” according to The Wall Street Journal.

Here are a few other highlights from the article:

• Consumers can flag...

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