How do you dispute a credit score

How a typo can lower your credit score

In October 2019, Mark Wetzler looked for a new electricity provider online using a comparison portal. He struck gold, requested a contract and didn't think about it any further. Two days later he received a letter from the utility company informing him that no contract would be concluded because his credit rating was too weak.

Mark Wetzler was stunned by this answer. The well-off man, who lives in the center of Hanover, says that in the 52 years of his life he paid all his bills on time - except for one, in 1987, when his student loans were received too late on his account.

He asked for a statement from CRIF Bürgel, the company that had calculated its creditworthiness. In November, he received a letter showing his creditworthiness was 2.9 (on a scale of 1 to 6, where 1 is the best score). The rating was based on information from a telecommunications company, online marketing companies and “payment information about his home”. Strangely, the same letter stated that CRIF Bürgel was not aware of any negative features. It remained a mystery why Mark Wetzler was ranked so low.

Five months and a few emails later, in March 2020, CRIF finally delivered a statement to Bürgel. When Mark Wetzler requested the electricity contract online in October, he probably made a typo (he says he doesn't remember what exactly he typed). The request was made for a mark "Wetzer" (without an l) with the same address. According to CRIF Bürgel, this explains everything and releases the company from any responsibility in the matter. Nevertheless, Mark Wetzler's rating went to the electricity supplier - now the score was 1.2, a very high credit rating.

The story could end on the typo. However, the company's letter was sent (correctly spelled) to Mr. Wetzler in November. According to CRIF Bürgel, such simple spelling errors are routinely and automatically corrected.

So there are three possible explanations:

  1. CRIF Bürgel does not check for spelling mistakes in names before a credit score is sent, but only afterwards;
  2. Depending on how the names are spelled, CRIF Bürgel delivers different scores to people who the company knows are the same person; or
  3. CRIF Bürgel relied on incorrect data about Mark Wetzler for the credit rating calculation.

In view of the fact that CRIF Bürgel vehemently denies having done anything wrong, the third hypothesis can be dropped.

If one of the first two explanations should be correct, it is difficult to bring them together with German law on credit ratings. Calculating the probability that a person will repay a loan is only allowed if a "scientifically recognized mathematical-statistical procedure" is applied. On the other hand, if it can be shown that people who misspell their names are less likely to repay their loan, that might justify explanation # 2.

The Bavarian State Office for Data Protection, which monitors the credit scoring by CRIF Bürgel, does not comment on the case, even after several inquiries.

In 2018, AlgorithmWatch and the Open Knowledge Foundation Germany carried out a large-scale study of the Socring process by Germany's largest credit agency: the OpenSchufa project. The evaluation showed that the supervision of the credit agency is at least inadequate. Mark Wetzler's story shows that little has changed since then.

Translation: Jen Theodor

Disclosure: AlgorithmWatch receives financial support from the Bertelsmann Foundation, which owns the Bertelsmann Group, which owns Arvato, which operates a credit bureau.