Credit – Data Transfer

Some furnishers report their customers’ account data to credit reporting agencies via magnetic tape, delivered by courier, but most transmit the data electronically. Since 1997 the industry standard has been Metro 2. Metro 2 is simply a format created by software called Credit Manager, which is produced by The Service Bureau. It uses more identifiers (match data) than the older version, Metro 1, and while Metro 1 was transmitted solely by courier, Metro 2 permits the transfer of data to the bureaus over the Internet. As with all things, the industry treats this information as a state secret, though some of it has come out in lawsuits through the process of discovery. Although not all furnishers use Metro 2 to transfer their data electronically, the credit reporting agencies report that up to 80 percent of their subscribers or furnishers have converted to Metro 2.

One problem with tapes is that they can be lost or stolen, whereas data transmitted over the Internet is encrypted with very high security and is not likely to be compromised. In 2005, Bank of America lost computer tapes containing the financial and personal data of 1.2 million government employees, including U.S. senators. Those tapes contained all sorts of information that identity thieves would love, including SSNs and account information. And in June 2005, Citigroup claimed that UPS lost its computer tapes, which housed account information and SSNs on 3.9 million customers.

When a furnisher/subscriber contacts a bureau requesting a specific adjustment to account information, usually a correction, that request can be performed manually instead of waiting for the Metro 2. That is, furnishers can contact the bureaus at any time, using a standard form known as a Universal Data Form (UDF). There are different variations, but essentially this form is designed to streamline the communication process between the bureau and the subscriber. The UDF consists of standardized information that enables the bureaus to quickly cut to the chase and perform whatever action the furnisher chooses.

The use of the UDF is important to consumers, because they often need information corrected in a hurry. Metro 2 “dumps” are only performed one a month, whereas the UDF makes it possible to have information updated or corrected in less than three days. There’s a paper and an automated version (electronic) of the UDF form. I always require a paper copy be provided to me as a condition in all my written settlement agreements. You should do likewise.

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