Federal Trade Commission Fines Free Credit Report Website, Again
In 2005, Consumerinfo.com was fined $950,000 by the FTC for deceptive trade practices. Law week, the company, doing business as Experian Consumer Direct, agreed to another $300,000 FTC settlement for continuing to deceive consumers.
According to the FTC, Consumerinfo.com advertised “free credit reports” to consumers but failed to adequately disclose that those who signed up would be automatically enrolled in a credit-monitoring program and charged $79.95.
In addition to the free credit report, the company offered what was billed as free trials of a credit- monitoring service. To qualify for the service, consumers were required to give detailed personal information and a valid credit card account number. After the free trial period expired, consumers were automatically charged a $79.95 annual membership, unless they notified the Consumerinfo.com within 30 days to cancel the service. The 2005 complaint also alleged that Consumerinfo.com told consumers their credit card number was “required only to establish your account.”