Thursday, March 30, 2023

SECU Risk-based Lending - Uh-oh, Better Call "Legal" - RBL #17

 To: SECU Board of Directors

Chris Ayers ImageDear Chairman Ayers,

The SECU Board has implemented a risk-based lending system at SECU, which is - as we speak - overcharging thousands of SECU members literally millions of dollars in excessive interest costs.   

Mr. Ayers, you claim that you and the SECU Board have diligently vetted the fairness and accuracy of using credit scores to charge SECU members in RBL tiers "B, C, D, E" higher loan interest rates. You make that claim despite the fact all three major credit bureaus publicly state credit scores can not predict if an individual borrower will default in the future. What "secret" about credit scores do you and the SECU Board know, which the credit bureaus don't know?

Can we also assume that you and the SECU Board are aware of the following six facts about the unreliability of any given credit score?

👉 6 reasons why your credit score differs:

  1. Credit scoring model used: There are several models out there for scoring your credit history. Companies evaluate the same main factors of your credit history like payment history and utilization rate, but use their own formulas to weigh each factor.
  2. Score version: There are dozens of credit score versions that are broken up into base scores and industry-specific scores.
  3. Credit bureau: Credit scores are calculated using data listed on your credit report, which comes from one of the three major credit bureaus — Experian, Equifax or TransUnion. Your score differs based on the information provided to each bureau,
  4. Information provided to the credit bureaus: The credit bureaus may not receive all of the same information about your credit accounts. There’s no guarantee that the information will be the same across the board, creating potential differences in your scores.
  5. Date scores are accessed: If you view your credit score at different times, there may be discrepancies since one score may be outdated.
  6. Errors on your credit report: Your credit score can reflect any errors that appear on your credit report.

Credit scores are neither predictive nor reliably accurate, according to the experts in the credit scoring business (not to mention highly discriminatory!) 

But Mr. Ayers, despite these facts, you and the SECU Board petulantly persist in using credit scores "to profile" and overcharge at least 50+% of SECU borrowing members. Why?

Better tell "legal" to get ready...yet another unforced error, yet another unnecessary cost to the SECU membership and yet another black eye for the Credit Union.


Let's see what the legal definition of overcharging is: to gouge, to stick, to fleece, to skin, to clip, to soak, to sting, to cheat, to defraud... yep better give "legal" a little call!


Team Players, Raise Your Hand If You Agree With Me...


...As a team player, let me put that to you another way, raise your hand or else! 😃😃😃😃😃