FTC Sues Imposter Web Sites Offering "Free Credit Reports"

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Copyright © 2005-2016
Privacy Rights Clearinghouse
Posted August 20, 2005


You May be Eligible for a Refund

The FTC this week announced a lawsuit and simultaneous settlement with Consumerinfo.com, a subsidiary of the credit bureau Experian, and freecreditreport.com, companies that advertise free credit reports. The FTC charged the companies with "deceptive and misleading" claims. www.ftc.gov/opa/2005/08/consumerinfo.htm

How consumers were deceived. Consumerinfo.com and freecreditreport.com advertised "free credit reports," but failed to inform consumers that they were automatically signing up for credit report monitoring services and would be charged $79.95 if they did not cancel within 30 days. The FTC also charged that the web site freecreditreport.com failed to inform consumers that it was not associated with the official annual free credit report program established by recent amendments to the Fair Credit Reporting Act.

Consumers were drawn to Consumerinfo.com and freecreditreport.com web sites through radio, television, e-mail and Internet ads promising free credit reports and free monitoring services. In some cases, consumers were led to the sites through an Internet search for terms such as "free credit report," "free credit score," and "free credit history." Consumers who visited the sites were required to supply a great deal of personal information in addition to a valid credit card number. When membership was not cancelled within 30 days, credit card accounts were charged.

How to obtain your refund. As part of the settlement, some consumers are entitled to a refund or automatic credit. This depends on several factors, primarily when you ordered your free report. You should receive notice of your eligibility for a refund from Consumerinfo. For more on eligibility for refunds as well as information on how to contact this company, see www.ftc.gov/bcp/conline/edcams/freereports/consumerinfo_faqs.pdf
You can also call a consumer hotline -- (202) 326-3457-- for information on refunds.

How to order your free credit report. The Fair Credit Reporting Act allows consumers to get one free credit report from each of the three national credit bureaus - Experian, Equifax, and TransUnion -- every 12 months. However, the only official web site for ordering free reports is www.annualcreditreport.com. Free annual reports may also be ordered by phone at 877-322-8228, or by mail addressed to: Annual Credit Report Request Service, P.O. Box 105281, Atlanta, GA 30348-5281. Offers for free credit reports from any other source may be a scam.

"Call, Don't Click." A recent report by the World Privacy Forum warned of the dangers of impostor web sites, recommending that free reports be ordered by telephone or mail. See www.privacyrights.org/media/calldontclickupdate.htm for additional tips for ordering your free reports. See also www.worldprivacyforum.org and read the report "Call, Don't Click."

Additional FTC actions. In addition to the recent lawsuit, the FTC has now sent warning letters to more than 130 impostor web sites. The FTC's warning letter is available at: www.ftc.gov/opa/2005/08/consumerinfoletter.pdf

Tips for consumers. With so many impostor sites operating, it is easy to be fooled. If you want to order online, the best advice is to type in the URL for the official site or link to the site through the FTC's publication on free reports. www.ftc.gov/bcp/conline/edcams/credit/ycr_free_reports.htm.

If you are uncertain that the site you are on is the "official" web site, here are some tips.

The official web site will not:

  • Ask for a credit card number.
  • Make ordering your free credit report contingent on the purchase of other products like a credit scores or monitoring services.
  • Send you an unsolicited e-mail advertising a free credit report.
  • Advertise on television on through pop-up ads.

The FTC asks that any unsolicited e-mail for free credit reports be forwarded to spam@uce.gov.
Or, you can file a complaint with the FTC at https://rn.ftc.gov/pls/dod/wsolcq$.startup?Z_ORG_CODE=PU01

For more information:

Information for Consumerinfo.com Customers, www.ftc.gov/bcp/conline/edcams/freereports/consumerinfo_faqs.pdf

FTC Consumer Alert , Want a Free Annual Credit Report?
The Only Official Website is annualcreditreport.com
, www.ftc.gov/bcp/conline/pubs/alerts/freerepalrt.htm
Spanish, www.ftc.gov/bcp/conline/spanish/alerts/s-freerepalrt.htm

FTC v. Consumerinfo.com., Inc., a corporation, doing business as
Experian Consumer Direct, Qspace, Inc., and Iplace Inc., Defendant., United States District Court for the Central District of California, File No. 022 3263
Civil Action No. CV - SACV05-801 AHS(ML,Gx), Complaint, Settlement, and FTC News Release, www.ftc.gov/os/caselist/0223263/0223263.htm