Fifth Third Bank has told potentially thousands of credit-card customers that it inadvertently reported to the credit-reporting agencies that the customers had filed for bankruptcy. The Cincinnati-based bank said yesterday that it has sent letters to what it called a "limited number" of customers who the bank said were affected by the reports. One customer who asked that his identity not be revealed because of concerns about his privacy said the bank told him 21,000 customers were affected.

Fifth Third Bank has told potentially thousands of credit-card customers that it inadvertently reported to the credit-reporting agencies that the customers had filed for bankruptcy.

The Cincinnati-based bank said yesterday that it has sent letters to what it called a �limited number� of customers who the bank said were affected by the reports. One customer who asked that his identity not be revealed because of concerns about his privacy said the bank told him 21,000 customers were affected.

Tips to ensure your credit report is correct

The bank said the error has been fixed and the affected customers shouldn�t notice any change in their credit scores. The bank also said it is working with customers individually to resolve any issues.

�Obviously, we took this action to correct this, and we want to make sure customers know it has happened,� spokeswoman Stephanie Honan said. �If they have questions or concerns, they can reach out to us.�

She said the error occurred because of a �systems change� the bank was making. It was corrected in December, and the credit-reporting agencies were notified. She didn�t provide other details about the nature of the problem.

�It�s our error. We accept that,� Honan said.

The credit-reporting agencies are a key component to an economy that runs on credit.

The three main agencies � Equifax, TransUnion and Experian � do not determine if a consumer qualifies for a loan or at what rate. Instead, the agencies maintain a history of a consumer�s credit activity that is based on reports by lenders and creditors along with other information, such as bankruptcies, civil judgments and tax liens.

Consumers have been hit with an assortment of issues in recent years that have threatened their credit. Typically, they involve some kind of breach in which thieves have stolen customers� personal information as opposed to a bank making an error. Credit-reporting agencies also have been criticized for failing to correct inaccurate reports.

�This is definitely unusual,� said Greg McBride, senior financial analyst with Bankrate.com. � The question that comes to my mind is how widespread is it? What was the range of customers impacted? I mean, something like this is more damaging to someone with an 800 credit score than for someone with a 500 score.�

A bad credit score can make it more difficult for someone to get a loan, buy a home or lease a car. It also can make homeowner- and car-insurance policies more expensive because insurers think those with poorer credit are more likely to file claims than those with high credit scores.

A bankruptcy filing would be brutal to a credit score, McBride said.

�It�s like burning down the house in terms of the credit score,� he said.

But before consumers file for bankruptcy protection, they typically would have fallen behind on loan payments already and racked up a lot of debt, as opposed to suddenly filing for bankruptcy, he said.

How damaging can Fifth Third�s error be? It depends, McBride said.

�The longer that inaccurate information is on the credit report, the more potentially damaging it could be,� he said.

Consumers whose credit score has suddenly dropped might have learned about it from a creditor that scaled back on a line of credit, a bank that denied a loan, or an insurance company that raised premiums, he said.

It shouldn�t be as serious as someone having their identity stolen and the thief opening up credit accounts in the victim�s name, he said. In the case of Fifth Third, the damage can be fixed, he said.

But consumers shouldn�t take the bank�s word that everything has been corrected, McBride said.

Consumers already should be regularly pulling their credit reports from the major credit-reporting agencies to look for errors, he said.

�If everything there is OK, the credit score should take care of itself,� he said.

Credit-reporting agencies typically have 30 to 45 days from the time they are notified to fix a mistake, but in a case like this, the agencies likely would work much faster because of the potential effects on the consumer, said Cara Hill, the central Ohio division manager of Apprisen financial-counseling service.

Hill said Fifth Third likely has offered credit-monitoring and other services to the affected customers.

Consumers also can turn to the federal Consumer Finance Protection Bureau for help in dealing with the bank, she said.

Like McBride, Hill said consumers are in the best position of making sure that their credit information is correct.

�You�re your own best advocate,� she said.

mawilliams@dispatch.com