Controversial technique lets one consumer boost another’s credit score

By Jeremy M. Simon

Piggybacking lives. Consumers who have good credit will continue to be able to boost others’ credit scores by adding them as authorized users on credit card accounts through a practice known as “piggybacking.”

Fair Isaac Corp., creator of the well-known FICO credit score, had announced last year it would end the practice due to abuses, but during Congressional testimony Tuesday, acknowledged it had changed its mind. A company official broke the news during a House Financial Services Subcommittee on Oversight and Investigations hearing entitled “What Borrowers Need to Know about Credit Scoring Models and Credit Scores.”

“After consulting with the Federal Reserve Board and the Federal Trade Commission earlier this year, Fair Isaac has decided to include consideration of authorized user trade lines present on the credit report” in a revamped version of the credit score formula called FICO 08, Thomas J. Quinn, Fair Isaac’s vice president of scoring solutions, said in prepared testimony. “Our scientists have devised a method to consider these trade lines while materially reducing the negative impact that could arise from piggybacking.”