Researchers awarded $1.13 million to study credit agencies

UMSL’s Center for Business and Industrial Studies has been awarded $1.13 million to conduct a national study on the accuracy of information maintained by the major U.S. credit reporting agencies. The team of UMSL scholars and student graduate assistants who will conduct the study includes, from left: Leonardo Severino, graduate research assistant; Justin Antonacci, graduate research assistant; Maureen Karig, senior research associate for the center; Thomas Eyssell, associate dean; Aicha Liesenfeld, graduate research assistant; L. Douglas Smith, director of the center; and Jennifer Holmes, graduate research assistant.

The University of Missouri–St. Louis Center for Business and Industrial Studies, directed by L. Douglas Smith, has been awarded $1.13 million from the U.S. Federal Trade Commission to conduct a national study on the accuracy of information maintained by the major U.S. credit reporting agencies.

The study uses a formal procedure for resolving alleged errors under the Fair Credit Reporting Act and will provide valuable information on the workings of the FCRA dispute resolution process. Further, the study will provide anonymous, but detailed information on credit usage and payment behavior that will help the researchers consider how consumers may best be educated to use credit responsibly and help protect themselves against abusive lending practices.

Smith, director of the Center for Business and Industrial Studies and professor of management science at UMSL, and Thomas Eyssell, associate dean and director of the college’s registered Financial Planning program, are collaborating with colleagues at the University of Arizona in Tucson, Fair Isaac Corporation and the U.S. Federal Trade Commission, to execute the study.

“We are extremely pleased to be executing this study in collaboration with Professor Mike Staten and his team of researchers at the University of Arizona, and also with professionals at Fair Isaac Corporation,”  Smith said. “They have worked with us over the past five years on two pilot studies for the FTC to develop and test the research methodology. With collaborations of this nature, we provide a rich blend of talents for our sponsored research.”

The university research teams conduct in-depth reviews of consumer credit reports in telephone interviews with study participants and work with analysts at FICO to determine the impact of alleged errors on the participants’ credit scores.

“Virtually all of us are affected by consumer credit scores in our financial lives,” Eyssell said. “These scores are used not just to determine the terms of mortgages and consumer credit; they have also been used in some employment decisions and in setting discounts for insurance.”

Maureen Karig, senior research associate with the Center for Business and Industrial Studies at UMSL, and student research assistants Justin Antonacci, Jennifer Holmes, Aicha Liesenfeld and Leonardo Severino are educating consumers in credit-related matters as they gather the research data for the study.

“I have been extremely impressed with the team of students we have – from both the College of Business Administration and the School of Social Work – working on this national study,” Karig said. “It is a tremendous opportunity for them to engage with university faculty, business professionals and U.S. consumers, while investigating a critical element of today’s financial environment.”

More information:
http://www.umsl.edu/divisions/business/ncbis/index.html

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