They have your number (and a lot more).

Money In America Has No Boundaries

I recently received a letter from the National Consumer Telecom & Utilities Exchange (NCTUE) notifying me that either negative information had been added to my credit report or they had received eight inquiries pertaining to my telecom/utility credit history. It seemed like it might be from a credit reporting agency, but wasn’t from any of the big three.

At the end of the letter was a form to fill out and send back to request a copy of my credit report (free of charge, as is required by Colorado state law), which was pre-printed with one of my old addresses and with blank spaces for me to fill in my Social Security number, date of birth and signature – all of which made me highly suspicious of an attempt at identity theft. I immediately went to the internet on reconnaissance and what I discovered both surprised and infuriated me.

You’re probably familiar with the three main credit reporting agencies: Experian, TransUnion and Experian. They are the biggest in the U.S. but certainly not the only ones.

NCTUE is a type of CRA known as Specialty Consumer Reporting Agencies that compile and maintain industry specific records on consumers nationwide relating to medical records or payments, residential or tenant history, check writing history, employment history, or insurance claims. (Uhm, yes, agencies like these are compiling all sorts of personal information about you and sharing it amongst themselves, without your knowledge or consent.) Other under-the-radar agencies like this are LexisNexis, Innovis/CBC, and Acxiom Corporation. They are all legally required to comply with Fair Credit Reporting Act (FCRA) requirements, among other consumer credit laws, although it’s unclear how many actually do.

Who Are These People?

According to their website, NCTUE is “a consortium of over 60 member companies from the Telco, Utility, and Pay TV industries. The Board is comprised of members from Telecommunications, Pay TV companies and Utility companies. The Exchange is managed by an Executive Director and a 12-member Board of Directors. Exchange membership is governed by member agreements, operating guidelines and bylaws.” NCTUE is managed by “Equifax Information Services, but the ‘Exchange’ does not include Equifax credit information nor is Equifax a member (owner) of it.” As presented on their FAQ page, “The NCTUE data report is a record of all Telecommunication, Pay TV and Utility accounts reported by exchange members, including information about a consumer’s account history, unpaid closed accounts and customer service applications. This information is used by other telecommunication, Pay TV and Utility service providers, who are members of the exchange, to assist them in the decision to extend services.”

Basically, if you’ve ever had a phone, cell phone, cable TV, internet service, or an electric bill in your name, this random organization has you on file. Apparently, thousands of Coloradans received (and were alarmed by) this letter around the same time in early 2012. Many of them notified the BBB and local media outlets questioning whether the letters were an attempt at large scale fraud or identity theft.

A local CBS News Denver affiliate reported on the letters in mid-March after viewers contacted them with concerns about the legitimacy and motives of the organization. CBS News 4 contacted Equifax, whose response (in part) read: “The National Consumer Telecom & Utilities Exchange, Inc. (NCTUE) is a member-owned database through which its member companies exchange source-anonymous information on new connect requests, payment history, and historical account status and/or fraudulent telecommunications/utility, or pay TV accounts. The Exchange limits the use of the database to these type applications, specifically prohibiting accessing it for other purposes including marketing.”

Can anyone explain how information sharing is “source-anonymous” if the information they’re sharing is consumer’s personal information, for the sole purpose of determining a specific individual’s credit worthiness?

It’s possible something even more nefarious is going on and has been for some time. Coloradan, Jeff Duntemann who (according to his blog reports) received one of NCTUE’s letters, did some digging and reported his findings. He posits that the letters could be a scam involving NCTUE, but actually initiated by one or more collection agencies.

As Duntemann puts it, “It works like this: a debt collection agency “re-ages” an expired debt (that is, a debt that is older than the statute of limitations) and attempts to collect it. They send notification of the debt to credit reporting services like Equifax, and then attempt to collect the debt, using the bad credit mark as a sort of threat. Enough people apparently send such agencies money to keep the business model alive.” In a follow-up post titled Beware the Zombie Debt Apocalypse he further explains the practice of zombie debt collection, when collectors either re-submit old debts that were written-off or beyond the statute of limitations for collection (6 years in CO), or they create debts never owed out of thin air to try and scare people into paying. These are clear violations of the Fair Credit Reporting Act and the Fair Debt Collection Practices Act, which are simply being ignored by unscrupulous collection agencies.

At the very least, don’t panic if one of these letters comes addressed to you in the mail. Whatever you do, don’t give them any personal information, especially your Social Security number and don’t pay anyone any money, ever. If you’re uncomfortable simply ignoring it, call them and ask for them to supply you with documentation of the specific “debt” in question. Based on what I’ve read, as soon as you ask them for documentation, they go away, because they don’t have any. If it’s a legitimate debt, they should lawfully provide you with the dates and details of the debt, and if that debt is outside of the statute of limitations for debt collection in your state, they are unlawfully seeking to collect on the debt. There are some good tips for dealing with zombie debt collectors here, should you ever have the misfortune of having to deal with one.  ✻