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| Topics and Issues | COVID-19 (41) Data Suppression (19) |
Dr. Michael Turner of PERC published an op-ed, Credit Reporting & COVID-19 – It’s Not a Sophie’s Choice, that appeared in Inside Sources. Turner returned to an ongoing theme about the dangers of suppression of credit reporting. When companies stop reporting accurate information to credit bureaus, credit reports will become less reliable and financial institutions will be making riskier loans and credit extensions. “Balancing consumer protections with concerns over systemic safety and soundness involves difficult choices. One senior regulator said, “It’s like juggling steak knives while wearing a blindfold.” Turner added that “[w]ith less accurate data, banks will make more lending mistakes. Consequently, lenders will respond to degraded credit data by raising minimum credit score requirements, decreasing the amount of credit available, and raising the price of credit to reflect a higher risk premium.”