Of course that won't happen because regulatory capture, but let's not wring our hands and pretend that this is a fundamentally difficult problem. It's not.
Those with the financial ability will have little incentive to do so.
My sister, who works for 15$ an hour, has successfully sued two very large companies when they don't hold up their end of a contract.
Even if only 'some' of the people wronged sue, it will lead to better practices for everyone.
She also sued a large solar-panel installation company because their installed panels didn't work after several months of techs coming over. This was only a partial success as the company liquidated. They had apparently done the same thing to a few other people, and got sued into oblivion.
Lawsuits are a good thing for society sometimes.
It's an arrangement called "contingency": https://www.legalmatch.com/law-library/article/contingency-l...
The downside is that a lawyer is likely not going to work with you unless they're sure they can get some decent money out of the case.
it’s a fictional character but that really sums up the type.
In what world? c'mon.
Juries hate when companies do wrong by the little guy, because they are themselves the little guy.
Not every case drags on for years. People regularly sue, for example, insurance companies. Both parties kind of know where they stand, and judges prefer that parties find a settlement that works.
My mom is unemployed and medically unfit to work. She was given a credit card, which I found out about after a few years. I spent 2 years passively trying to sort the issue out with the bank, to no avail.
I finally went to the banking ombud earlier this year, and the bank wrote off her debt a few days after. I could have gone further and tried to get her "bad credit" from the bank expunged (there's a complaints process), but it disappears after 2 years, so I just left it to be.
There needs to be a third party regulatory agency with real teeth where you don't need a pile of money to refute claims, just a little time for the regulatory agency to pressure them on your behalf. The courts aren't it although they probably should be.
The problem with our legal system is that in large part pointed out by GP, there's often a financial correlation in just how much you can utilize it which makes it ripe for exploitation by those with piles of capital laying around.
The CFPB could probably use sharper teeth
"Class actions" achieve very little; the only thing they do is make lawyers wealthier and if by some miracle the case succeeds, everyone else will get a 5$ coupon.
Real change requires changing laws by the democratic process and that can only happen when the population unites to hold the government strongly accountable.
I would argue that any other solution is a bandaid.
First, even if you find a lawyer to take it on contingency, there are quite a few hard costs that are still out of pocket. Postage, document prep fees, travel expenses for depositions, expert witnesses, etc. It can literally be thousands of dollars.
Second, if your state does not allow for punitive damages for this type of violation, you need to prove damages. It is hard to quantify what the economic damage is of a credit denial or difficulty finding a lender is, and thus they will tie you and your lawyer’s time up with arguing this, even if they concede they erred.
Third, there is a serious time commitment to make in a lawsuit. Interviews, timely filings, certified mailings, depositions, etc. Easily tens of hours possibly hundreds.
Now, the type of person who can afford the time and expense of doing these things is generally also the type of person who can ignore a small hit to their credit score or a higher interest loan. Thus, these types of suits are not commonplace.
That said, I know someone who did this and was successful in getting a settlement.
Credit ratings bureaus enter into contractual agreements with both data suppliers and their customers and frequently deal with data that has a material impact on those who have no direct arrangement with the ratings bureau. I don't think it's unreasonable to expect a higher degree of data integrity and reliability in that case, and HN vs. a credit bureau is a terrible comparison.
Credit bureaus aren't covered by the CDA since they aren't online or interactive information providers.
Instead, the correct approach is to pay damages, and then, in a separate case, try to recover damages from that other party that you claim is at fault. If the other party is bankrupt or can't be found, you're gonna lose out.
Regulatory capture is a huge issue, it is difficult to solve, it is the real mother-issue of many other issues (like this one, you argue), and is fundamental to modern governance. Credit scoring is transitively a fundamentally difficult problem.
The real fix is to only allow credit reporting systems to report on current debt, not any past debt or behaviour. (on top of the liability for mistakes you propose).
[1] https://www.courthousenews.com/high-court-wont-review-immuni...
But just like suing a large firm, when sending a $1000/hr corporate lawyer to small claims court, it makes more sense to just settle quickly.
Not many people realise this.
Not speaking from personal experience, but I'm aware of a small number of cases where credit agencies, shops, and banks were sued for downgrading a credit score because of their own mistakes.
I suspect this would be less likely to succeed in the US. But it's interesting that technically a downgraded credit score - especially with proof of consequent harms and expenses - is very close to the legal definition of defamation.
Teaching budgeting in schools would be a good start.
And remember even if you don't technically need those things, you might be much wealthier by the end of your life if you use those things, since both are effectively leveraged investment vehicles, allowing you to invest more and get more returns in good economic times.
You know who gets rich? People who do not spend their money.
And don't make it sound like "investment" is always a positive thing. many people are still paying for their "investments" from 2008.
Housing may be the exception, but you do not need a good credit score to get a loan for a house. Banks do not make these decisions on credit score alone.
https://www.ramseysolutions.com/real-estate/no-credit-score-...
What I am saying is that people should be spend less, save their money, and never going into any kind of debt, and ignore their credit score.
He also says that you should give 10% to the church while getting out of debt.
The reality is that, at least in the US, it is a requirement for nearly everyone to have a mortgage to purchase a house and even for those who can afford to purchase without a mortgage it makes more sense to get one anyway since mortgage interest is usually lower than the rate of returns for other investments you would be keeping the cash in, and you get tax benefits both by not realizing gains to liquidate investments to buy a house and the interest for the mortgage is tax deductible via the mortgage interest credit program.
Acting as if anyone is realistically out here buying houses in cash other than corporate investors / REITs, is silly. Even people on significant tech salaries are both better served and much more probably to have a mortgage even in LCOL areas.
Maybe there can be a system where dollar bills slowly peel out in front of me as I do my daily work?
Debt exists for a reason. It's more useful than cash.