Company:FICO

From HandWiki
Fair Isaac Corporation
FICO
TypePublic
IndustryData analytics
Founded1956; 70 years ago (1956) (as Fair, Isaac, and Company)
Founders
HeadquartersBozeman, Montana, U.S.
Area served
Worldwide
Key people
William Lansing (CEO)[1]
ProductsFICO score
ServicesComputer software
RevenueIncrease US$1.72 billion (2024)
Increase US$734 million (2024)
Increase US$513 million (2024)
Total assetsIncrease US$1.72 billion (2024)
Total equityDecrease −US$963 million (2024)
Number of employees
3,586 (2024)
Websitefico.com
Footnotes / references
[2]

FICO (legal name: Fair Isaac Corporation), originally Fair, Isaac and Company, is an American data analytics company based in Bozeman, Montana, focused on credit scoring services. It was founded by Bill Fair and Earl Isaac in 1956.[3] Its FICO score, a measure of consumer credit risk,[4] has become a fixture of consumer lending in the United States.

In 2013, lenders purchased more than 10 billion FICO scores and about 30 million American consumers accessed their scores themselves.[5] The company reported a revenue of $1.29 billion for the fiscal year of 2020.[6]

History

FICO was founded in 1956 as Fair, Isaac and Company by engineer William R. "Bill" Fair and mathematician Earl Judson Isaac.[7] The two met while working at the Stanford Research Institute in Menlo Park, California.[8] Selling its first credit scoring system two years after the company's creation,[9] FICO pitched its system to fifty American lenders.[10]

FICO went public in July 1987[11] and is traded on the New York Stock Exchange.[7] The company debuted its first general-purpose FICO score in 1989.[4] FICO scores are based on credit reports and "base" FICO scores range from 300 to 850,[4] while industry-specific scores range from 250 to 900.[12]

Lenders use the scores to gauge a potential borrower's creditworthiness.[13]

Fannie Mae and Freddie Mac first began using FICO scores to help determine which American consumers qualified for mortgages bought and sold by the companies in 1995.[14]

Name changes

Originally called Fair, Isaac and Company (hence the abbreviation FICO), this name was changed to Fair Isaac Corporation in 2003.[9]

Headquarters moves

Originally based in San Rafael, California, FICO moved its headquarters to Minneapolis, Minnesota, in 2004, a few years after Minnesota resident Thomas Grudnowski took over as CEO.[15] In 2013, it moved its headquarters to San Jose, California, a year after CEO William Lansing joined.[16] In 2016, it opened an office in Bozeman, Montana, which later[when?] became its headquarters.[17]

Acquisitions

  • DynaMark 1992[18]
  • Risk Management Technologies 1997[19]
  • Prevision 1997[20]
  • Nykamp Consulting Group 2001[21]
  • HNC Software 2002[22]
  • NAREX 2003[23]
  • Diversified Healthcare Services 2003[24]
  • Seurat (2003)[25]
  • London Bridge Software 2004[26]
  • Braun Consulting 2004[27]
  • RulesPower 2005[28]
  • Dash Optimization 2008[29]
  • Entiera 2012[30]
  • Adeptra 2012[31]
  • CR Software 2012[32]
  • Infoglide 2013[33]
  • InfoCentricity 2014[34]
  • Karmasphere 2014[35]
  • TONBELLER AG 2015[36]
  • QuadMetrics 2016[37]
  • GoOn 2018[38]
  • EZMCOM 2019[39]

Antitrust issues

In March 2020, the US Department of Justice (DOJ) opened an antitrust investigation into FICO, which was reported to be closed in December 2020.[40][41] In March 2024, US Senator Josh Hawley sent a letter to the DOJ's Antitrust Division urging them to open an investigation into FICO for anti-competitive practices, stating that the company "appears to be using its monopolistic power over the credit scoring market to increase costs for mortgage lenders."[42][43][44]

Between 2020 and 2023, at least 10 antitrust class action lawsuits were filed against FICO involving "business to business" purchases of FICO scores, with the plaintiffs alleging that FICO maintains monopoly power through anticompetitive agreements and charges artificially inflated prices for FICO scores.[45][46] In September 2023 US District Judge Edmond Chang ruled that the plaintiffs, which include credit unions, banks, mortgage lenders, real estate brokerages, auto dealers, and other companies, had presented enough evidence that FICO had violated antitrust law to allow the lawsuits to proceed.[45][46]

Operations

FICO is headquartered in Bozeman, Montana and it has additional U.S. locations in San Jose, California, Roseville, Minnesota, San Diego, California, San Rafael, California, Fairfax, Virginia, and Austin, Texas.[47]

The company has international locations in Australia, Brazil, Canada, China, Germany, India, Italy, Japan, South Korea, Lithuania, Malaysia, the Philippines, Poland, Russia, Singapore, South Africa, Spain, Taiwan, Thailand, Turkey, and the United Kingdom.[47]

FICO score

A measure of credit risk, FICO scores are available through all of the major consumer reporting agencies in the United States: Equifax, Experian, and TransUnion.[48] FICO scores are also offered in other markets, including Mexico and Canada,[49] as well as through the fourth U.S. credit reporting bureau, PRBC.[50]

References

  1. ↑ "FICO shuffles executive ranks under new CEO". Twin Cities Business. 25 April 2012. http://www.twincities.com/ci_20481216/fico-shuffles-executive-ranks-under-new-ceo. 
  2. ↑ "FY 2024 Annual Report (Form 10-K)". U.S. Securities and Exchange Commission. November 6, 2024. https://www.sec.gov/ix?doc=/Archives/edgar/data/0000814547/000162828024045719/fico-20240930.htm. 
  3. ↑ "How FICO became 'the' credit score". finance.yahoo.com. 2013-12-12. https://finance.yahoo.com/news/fico-became-credit-score-100000037.html. 
  4. ↑ 4.0 4.1 4.2 Ann Carrns (10 May 2012). "Is That Credit Score a FICO, or a FICO 8?". New York Times. http://bucks.blogs.nytimes.com/2012/05/10/is-that-credit-score-a-fico-or-a-fico-8/. 
  5. ↑ Evan Nemeroff (7 March 2014). "New FICO Scoring Model Coming This Summer". National Mortgage News. http://www.nationalmortgagenews.com/news/technology/new-fico-scoring-model-coming-this-summer-1041282-1.html. 
  6. ↑ "Fair Isaac Corp (FICO) Q4 2020 Earnings Call Transcript" (in en). 2020-11-10. https://www.fool.com/earnings/call-transcripts/2020/11/10/fair-isaac-corp-fico-q4-2020-earnings-call-transcr/. 
  7. ↑ 7.0 7.1 Dean Foust; Aaron Pressman (2008-02-06). "Credit Scores: Not-So-Magic Numbers". Bloomberg.com. http://www.businessweek.com/stories/2008-02-06/credit-scores-not-so-magic-numbers. 
  8. ↑ Jennifer Bjorhus (2013-01-04). "Fair Isaac moving its HQ back to California". http://www.startribune.com/business/185665572.html. 
  9. ↑ 9.0 9.1 About Us | FICO — FICO official Web site
  10. ↑ Adriene Hill (2014-04-22). "A brief history of the credit score". http://www.marketplace.org/topics/your-money/how-i-learned-stop-worrying/brief-history-credit-score. 
  11. ↑ "Notice of Annual Meeting of Stockholders of Fair, Isaac and Company, Incorporated". December 30, 1996. https://investors.fico.com/node/13956/html. 
  12. ↑ "What is a FICO score?". Fair Isaac Corporation. http://www.myfico.com/credit-education/credit-report-credit-score-articles/. 
  13. ↑ Ann Carrns (2012-05-03). "Report Finds Improvement in Credit Scores". http://bucks.blogs.nytimes.com/2012/05/03/report-finds-improvement-in-credit-scores/. 
  14. ↑ "North American Credit Scoring & Reporting". benbest.com. 2009-12-04. http://www.benbest.com/business/credit.html. 
  15. ↑ Dan Fost (11 May 2004). "Fair Isaac moving its hub / Most company executives already set up in Minnesota". SFGate. http://www.sfgate.com/business/article/Fair-Isaac-moving-its-hub-Most-company-2760210.php. 
  16. ↑ Pete Carey (4 January 2013). "FICO moves headquarters to San Jose". Mercury News. http://www.mercurynews.com/ci_22307524/fico-moves-headquarters-san-jose. 
  17. ↑ "Silicon Valley Analytics Pioneer FICO Announces Expansion in Bozeman, Montana" (in en). https://www.fico.com/en/newsroom/silicon-valley-analytics-pioneer-fico-announces-expansion-bozeman-montana. 
  18. ↑ "FICO consolidating operations in Roseville". twincities.com. 2012-06-22. http://www.twincities.com/ci_20918752/fico-consolidating-operations-roseville. 
  19. ↑ "RMT Merges with Fair, Isaac". July 1997. http://www.contenthouse.com/rmt/newspg/radrscp/fi-mergr.htm. 
  20. ↑ "Bruce D D'Ambrosio". buy-sell-econtent.com. http://www.buy-sell-econtent.com/2011/Speakers/BruceDAmbrosio.aspx. 
  21. ↑ "Fair, Isaac to acquire Nykamp Consulting". 2001-12-12. http://www.bizjournals.com/sanjose/stories/2001/12/10/daily24.html. 
  22. ↑ Fost, Dan (2002-04-30). "Fair Isaac merging with HNC Software". Sfgate. http://www.sfgate.com/business/article/Fair-Isaac-merging-with-HNC-Software-2844440.php. 
  23. ↑ "Narex sold for $10M". 2003-07-28. http://www.bizjournals.com/denver/stories/2003/07/28/daily7.html. 
  24. ↑ "Fair Isaac Acquires Diversified HealthCare". 2003-09-19. https://www.latimes.com/archives/la-xpm-2003-sep-19-fi-rup19.6-story.html. 
  25. ↑ "California firm buys Seurat". 2003-10-06. http://www.bizjournals.com/charlotte/stories/2003/10/06/daily7.html. 
  26. ↑ "Fair Issac offers $166m for London Bridge Software". 2004-04-26. http://www.stockmarketwire.com/article/345520/Fair-Issac-offers-166m-for-London-Bridge-Software.html. 
  27. ↑ "Fair Isaac and Braun Consulting Announce Acquisition Agreement". 2004-09-24. http://www.information-management.com/news/1010825-1.html. 
  28. ↑ "Fair Isaac Acquires RulesPower Technology to Advance Business Rules Capabilities". 2005-09-28. http://www.information-management.com/news/1038322-1.html. 
  29. ↑ "Fair Isaac Acquires Dash Optimization, Bringing Increased Power". https://www.bloomberg.com/apps/news?pid=newsarchive&sid=aB0dtBZx6z.k. 
  30. ↑ Howard Pankratz (2012-05-09). "Denver-based Entiera acquired by FICO". http://www.denverpost.com/ci_20582831/denver-based-entiera-acquired-by-fico. 
  31. ↑ "FICO completes $115M acquisition of Adeptra". finance.yahoo.com. Yahoo!. September 10, 2012. https://finance.yahoo.com/news/fico-completes-115m-acquisition-adeptra-175112495.html. 
  32. ↑ Ed Stych (2012-11-26). "FICO buys collections and receivables software company". http://www.bizjournals.com/twincities/news/2012/11/26/fico-buys-cr-software.html. 
  33. ↑ "Infoglide Software acquired by credit score giant FICO". 2013-04-04. http://www.bizjournals.com/austin/blog/abje_news/2013/04/infoglide-software-acquired-by-credit.html. 
  34. ↑ "FICO Set to Acquire InfoCentricity". 2014-03-14. http://www.nasdaq.com/article/fico-set-to-acquire-infocentricity-analyst-blog-cm335560. 
  35. ↑ "FICO Adds Big Data Analytics for Hadoop to FICO Analytic Cloud". 2014-05-16. http://www.marketwatch.com/story/fico-adds-big-data-analytics-for-hadoop-to-fico-analytic-cloud-2014-04-16. 
  36. ↑ "FICO Acquires TONBELLER". http://www.fico.com/en/FICO-acquires-TONBELLER. 
  37. ↑ "FICO Will Offer Enterprise Security Score for Organizations". http://www.fico.com/en/newsroom/fico-will-offer-enterprise-security-score-for-organizations-06-14-2016. 
  38. ↑ "FICO Acquires GoOn to Advance Growth in Brazil". https://www.fico.com/en/newsroom/fico-acquires-goon-to-advance-growth-in-brazil. 
  39. ↑ "FICO Acquires EZMCOM". https://www.fico.com/en/ezmcom-faq. 
  40. ↑ Nylen, Leah (2020-03-13). "DOJ opens antitrust probe into credit score giant Fair Isaac". Politico. https://www.politico.com/news/2020/03/13/justice-fair-isaac-antitrust-129204. 
  41. ↑ "FICO Announces DOJ Antitrust Investigation Closed". 2020-12-08. https://www.fico.com/en/newsroom/fico-announces-doj-antitrust-investigation-closed. 
  42. ↑ KTTN News (2024-03-13). "FICO faces scrutiny for anti-competitive behavior in credit scoring" (in en-US). https://www.kttn.com/fico-faces-scrutiny-for-anti-competitive-behavior-in-credit-scoring/. 
  43. ↑ Albright, Ty (2024-03-12). "Hawley calls on DOJ to investigate FICO for anti-competitive practices" (in en-US). https://newstalkkzrg.com/2024/03/12/hawley-calls-on-doj-to-investigate-fico-for-anti-competitive-practices/. 
  44. ↑ Nunes, Flávia Furlan (2024-03-21). "Senator urges DOJ to investigate FICO over increasing costs to mortgage lenders" (in en-US). https://www.housingwire.com/articles/senator-urges-doj-to-investigate-fico-over-increasing-costs-to-mortgage-lenders/. 
  45. ↑ 45.0 45.1 Scarcella, Mike (2023-09-29). "FICO loses bid to dismiss antitrust claims over credit-scoring market". Reuters. https://www.reuters.com/legal/transactional/fico-loses-bid-dismiss-antitrust-claims-over-credit-scoring-market-2023-09-29/. 
  46. ↑ 46.0 46.1 "FICO Loses Bid to Dismiss Antitrust Claims Over Credit-Scoring Market" (in en). 2023-10-01. https://www.pymnts.com/cpi_posts/fico-loses-bid-to-dismiss-antitrust-claims-over-credit-scoring-market/. 
  47. ↑ 47.0 47.1 "Office Locations". http://www.fico.com/en/about-us/locations/. 
  48. ↑ Credit Reporting Agencies — FICO official Web site
  49. ↑ "FICO Score for International Markets". FICO. 2017. http://www.fico.com/en/products/fico-score-international-markets. 
  50. ↑ Fair Isaac and PRBC Team Up to Enhance Credit Risk Tools Used by Mortgage Industry — FICO official Web site



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