Experian subsidiary paid $950,000 over deceptive "free credit report" marketing

Summary

The Federal Trade Commission brought an enforcement action in 2005 against ConsumerInfo.com, doing business as Experian Consumer Direct, over the marketing of supposedly free credit reports. ConsumerInfo.com was a wholly owned subsidiary of Experian North America. According to the FTC, consumers were attracted through television, radio, email and internet advertising promising free credit reports and free trials of credit-monitoring services. The FTC alleged that the company did not adequately disclose that consumers obtaining the supposedly free credit report would automatically be enrolled in a credit-monitoring service. Unless consumers cancelled within the trial period, they would be charged $79.95 for the service. The FTC also alleged that consumers were told that their credit-card information was required only to establish their accounts, even though those cards could subsequently be charged for the monitoring service. In addition, the FTC alleged that the company deceptively promoted its freecreditreport.com website without adequately disclosing that it was not associated with the official free annual credit-report program established by federal law. The settlement prohibited deceptive or misleading claims concerning free offers and imposed detailed disclosure requirements. ConsumerInfo.com was also required to provide redress to eligible consumers and surrender $950,000 in what the FTC described as ill-gotten gains. The FTC specifically required future promotions to clearly disclose that consumers would be charged unless they cancelled during the trial period. Primary source: Federal Trade Commission — Marketer of Free Credit Reports Settles FTC Charges: https://www.ftc.gov/news-events/news/press-releases/2005/08/marketer-free-credit-reports-settles-ftc-charges-0