Not Too Big to Let Fail: Wells Fargo (on credit scores in employment)

A Massachusetts state representative, a Believer, fell for the urban legend that employers use credit scores.  Asked for proof, the politician replied: “How to prove? AG Edwards is one I know of.”

A.G. Edwards, Inc. was acquired by Wachovia Securities, who was later acquired by Wells Fargo & Company.

Last month, the Florida Courier gave a Wells Fargo mouthpiecesenior vice president” an editorial column to spout off about credit scores.  The first sentence says, “Many of us are misinformed when it comes to credit.”

Uh– us,  indeed.  It – only – takes – four – clicks from Wells Fargo’s home page to get misinformed by this ridiculous little gem of a bullet point:

Employers often check the credit rating of prospective employees. A solid credit rating reflects positively on your ability to manage your job responsibly.

On the contrary, the consumer reporting agencies all state that they do not provide credit scores for employment purposes.

But what is a credit rating (as opposed to a credit score)Credit rating is a loose term bankers have thrown around for years, long before credit scores, to strike fear in the hearts of loan applicants.  It was a vague notion of some kind of evaluation of you that only wise bankers knew.  But today, according to the important, big, too-big-to-let-fail Wells Fargo, the terms are interchangeable:

Credit Score
Also known as a credit rating. Many lenders use this numeric calculation of your credit report to obtain a fast, objective measure of your credit risk, and consider your score when deciding whether or not to approve a loan.

Here’s another one (in an education sub-directory, no less):

Credit scores
A credit score — also known as a credit rating — is a numeric value based on the information contained in your credit report. That score (usually between 300 and 850) tells the lender the level of future risk associated with your credit history. The higher the score, the lower the risk.

But if you think linking the terms rating and score is a stretch, and the those instances are merely the result of keyboard finger-flapping by some low-ranking cubicle rat under pressure to write a silly website for a silly bank, then here is something overtly despicable:  Telling children the credit scores and employers urban legend:

8. c. Not just lenders but landlords and employers also use credit scores as a decision-making factor, so it’s important to build a good credit history and achieve a high score.


A lower score may even jeopardize your chances for landing a job.

It’s enough to make you fall off the Wells Fargo wagon. beats Federal Reserve again

Trend (views)


1993 – 2005 – 2027 – 2540 – 2672 – 2702 – 2805

(+58) The Federal Reserve:

554 – 643 – 716 – 1109 – 1194 – 1207 – 1265

(+101) – (Video 2):

161 – 207 – 308

SCORE UPDATE: increases lead over Fed gained 30 (+46 for Video 2) views while the Cleveland Fed only increased by 13.


1993 – 2005 – 2027 – 2540- 2672 – 2702

The Federal Reserve:

554 – 643 – 716 – 1109 – 1194 – 1207 (Video 2):

161 – 207


Here’s the latest score in terms of views:  2672 (says that credit buraus do not sell scores for employment purposes)

The Federal Reserve:  1194 (says employers, indeed, use credit scores) 161 (says that the idea that employers use scores is a myth)


1993 – 2005 – 2027 – 2540- 2672

The Federal Reserve:

554 – 643 – 716 – 1109 – 1194


[previous update]

Critique of Wikipedia – The silence is broken (for naught)

This has not happened in over a year.  Before Monday’s edit of the Wikipedia article Credit score (United States), 38 days had passed with no edits.  The last time that happened was November, 2009, when the span was 40 days.

Unfortunately, the new edits were of no substance.

The message board masquerading as an encyclopedia still misinforms anybody reading it. Its U.S. Credit score article falsely states that the so-called credit utilization ratio accounts for 30 percent of the FICO score, while the FICO company itself illustrates that that is not true.  The misinformation is now in its 7th year.  Ironically, the editor changed punctuation in that portion of the article, but failed to notice, indeed, the error of fact he was editing.  On the other hand, however, he makes no claims to credit score expertise in his profile: “Anime, manga, and science fiction fan; copy editor and wikifier—scourge of incorrect dashes and capitalization. ^_^.”


Even the Federal Reserve appears to have used wiki-nonsense in federal testimony.  If that is true, then Wikipedia is the Fed’s source, while the Fed is Wikipedia’s source.  So, who’s in charge, here?

The Wikipedian has been wiki-decorated with the WikiMedal for Janitorial Services, and his wikipage is festooned with the official wikimedallion.

At least they don’t take themselves too seriously.

Nobody should.

Myth: Employers use credit scores (video) – National Financial Literacy Month

National Financial Literacy Month – Video illustrates myth that employers use credit scores video shows media, experts, central bank and legislators furthering the myth that employers use credit scores in hiring decisions.

Myth: Employers use credit scores
Myth video: Employers use credit scores

Wikipedia links to Federal Reserve document that claims employers use credit scores

Popular message board pretending to be an encyclopedia Wikipedia added a link to a source using an unattributed claim this week.

In its article Credit score, Wikipedia listed the paper, “Your Credit Score Is a Ranking, Not a Score,” an item in the Federal Reserve Bank of Cleveland publication “Economic Commentary.” 

The first sentence of the November 16 paper states that credit scores are used in hiring decisions.  However, the consumer reporting agencies all state that they do not provide scores for employment purposes.  John Ulzheimer of calls it the myth of the decade.

To drive home the notion, the Federal Reserve even created a video containing a depiction of a job application.  The paper’s author, a Federal Reserve spokesperson and the chairman have not responded to a request for evidence supporting the claim.  The central bank did not mention again

The Wikipedia user who added the link has also contributed to the articles Bubble Tea, Play-Doh and The Ambiguously Gay Duo.  Last week, published “Groundhog Day, 2011 – Wikipedia on credit scores.” vs. The Fed – The 2007 employers incident

The Federal Reserve continues to gain on  There is 2010 (twice), 2008, and here is a 2007 incident. 

In “Impatience and Credit Behavior: Evidence from a Field Experiment” Federal Reserve researchers state, “Additionally, credit scores can be used by potential employers and landlords in employment and tenancy decisions.” 

Federal Reserve Bank of Boston Working Paper No. 07-3 is published on the Fed’s website.

Referring to the paper, the Federal Reserve Bank of Boston publication “Research Review” states, “FICO scores, which reflect an individual’s creditworthiness and are widely used to determine loan interest rates, insurance rates, employment offers, and tenancy decisions, are associated with long-run discount factors.” 

The hifalutin research document also states, “For scored individuals, the mean FICO score was 623 (s.d 83), which is below the U.S. average of 67816. ”

However, in August 2007, Fair Isaac said, “The average FICO score is not 678.”

Footnote 16 refers to– you guessed it– Experian.

But, all may not be lost, truthseekers– there could be a revision.  Page 1 states, “This paper, which may be revised, is available on the web site of the Federal Reserve Bank of Boston at”

ScoreInfo website launched by Fair Isaac

Fair Isaac introduced another website today:  ScoreInfo.  In a press release, Jordan Graham, president of FICO Consumer Services said, “FICO launched to help consumers better understand their disclosure notices and how to use that new knowledge to their benefit.”

On January 1, 2011, federal Fair Credit Reporting Act risk-based pricing notice rules went into effect.  The Federal Trade Commission and the Federal Reserve Board issued joint press releases, but there is no link to the Fed’s version here because its chairman, Ben Bernanke, has still not responded to the question about its statement about employers using credit scores.

The website joins Fair Isaac’s other websites and myFICO.