Credit Agency Fined A Second Time For Misleading People About Free Credit Reports

from the and-don't-let-it-happen-again dept

Wed, Feb 21st 2007 11:40pm — Mike Masnick

A few years back it was discovered that most of those sites advertising "free credit reports" were something of a scam. While many of them were run by the various credit agencies, they weren't the official AnnualCreditReport.com site, but rather tricks to get people to sign up for fee-based credit monitoring reports. Eventually, the FTC cracked down, fining Experian $950,000 for misleading the public. Apparently, though, the business generated by such practices was worth a lot more than that. It appears that Experian simply took the fine to be a cost of doing business for their Consumerinfo.com site, and have continued misleading people into signing up for a "free" credit report, and then quietly enrolling them in an $80 credit-monitoring program. So, now the FTC is back fining the company a second time, this time for $300,000. Given that the larger fine didn't get the company to mend its ways, somehow it makes you wonder if this new fine will be any more effective. It certainly does seem to be a conflict of interest to let these credit reporting companies charge you to alert you to whenever they might make a mistake. Of course, the credit agencies don't see it that way. Soon after this practice was originally outed, Experian competitor Equifax's CEO stated that it was "un-American" to let people view the information that these companies had about them for free.

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35 Comments

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free my shiny metal ..., 22 Feb 2007 @ 2:04am

freecreditreport.com
Wow, the FTC actually noticed this and did something (not enough obviously). These places have annoyed me for a long time. You are supposed to be able, by government mandate, to get one free credit report every year. I was able to dig one out of one of these 3 a few years ago, (after trying my best at all of them), but since then they have plugged that "hole".

Another peeve of mine is this place freecreditreport.com. Since when does "free" = $15? They have this catchy tune which I like to mangle. "At free cre-dit-re-port-dot-com your cre-dit-report's-not-free". You see it isn't really false advertising. You are paying $15 for something called a "free credit report".
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Bummycocks, 22 Feb 2007 @ 3:16am

Uhm, the synopsis makes no sense. First fined 950,000 and then 300,000? Perhaps it was 95,000 at first?
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The infamous Joe, 22 Feb 2007 @ 3:28am

Re:
No, you read correctly. $950,000 then $300,000.

You are also correct on the "makes no sense part" but it's not a fault with the post, it's with the FCC.

Imagine a world where fines went down each time you were fined. My speeding tickets would be a free oil change by now. :-P
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Don Goldberg, 22 Feb 2007 @ 4:47am

Even more revealing. . .
Even more interesting is the fact that when reading this thread, there is a list of "Free Credit Report" ads along one side of my screen, under a small "Ads by Gooooooogle" banner!
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Sherman T. Potter, 22 Feb 2007 @ 5:02am

That is Grade A, one hundred percent bull cookies!
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Anonymous Coward, 22 Feb 2007 @ 5:15am

response to free my shiny metal - AnnualCreditRepo
You need to go to the official site, AnnualCreditReport.com. You can get 3 reports a year, one from each of the major agenecies. I do it every year for both my wife and I. It works great.
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Volker, 22 Feb 2007 @ 5:23am

Sad to say i was one of those who got scammed!
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BigEd, 22 Feb 2007 @ 5:50am

I've gone through the AnnualCreditReport.com site for the last three years. And for the past three years I can't get one from TransUnion. Seems there is always a problem and I write them and they always say it's going to cost me $10. No problems with the other two sites.
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HangemHigh, 22 Feb 2007 @ 5:56am

Stiffer Penalty
A fine for scamming people is "just a cost of doing business" ... and they continue and continue again. Oobviously the laws aren't working.

What we need is a return to the old days when they would tar and feather the snake oil salesmen and run them out of town on a rail.

The penalty needs more impact. So how about putting the execs in jail for 6 months to a year in a hardcore prison so they can learn a lesson on being a con's girlfriend. Add a fine equivalent to the cost of their and their "boyfriend"'s upkeep in jail.
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Dam, 22 Feb 2007 @ 6:12am

A Proper Punishment
Adding two more zeros would have been the correct fine.

Going forward, all credit report ads and all credit bureau web sites should be required to have a live link to http://annualcreditreport.com at the top of the page,
in a font that's easily read, not something that can be buried at the bottom of the page.

Obtaining a free report was a major win for consumers and these bozos are tricking far too many people into spending money for what is rightfully free.

Credit bureaus are in desperate need of tighter regulation, and, being very much pro-business, it's not easy for me to state that. But, the power they have over the lives of consumers and the apparent lack of due diligence they exhibit in maintaining accurate data makes me agree to a much tighter regulatory environment for this industry.
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Overcast, 22 Feb 2007 @ 6:36am

Yeah, they aren't free... at least if you want a 'credit score' anyway.

Plus, the free credit score hype is just a way for the companies to run in your face how much credit card debt you have. Just like those commercials where you hear them saying they will save you money on your credit card using 'techniques the credit card companies don't want you to know', which is 180 degree misleading, as the credit card companies are the ones paying for that to attempt to collect debt.

Recent changes in bankruptcy law didn't fix much for them, people shrug and say 'oh well, I still can't pay it'.

Personally, I'm proud to say I've never had a real credit card, lol.
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Anyonymous jerk, 22 Feb 2007 @ 7:29am

Fine them again!
Fine them $1M, then $10M, then $100M, etc, and use the money to pay some of AMERICAS credit (national debt)
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Nasty Old Geezer, 22 Feb 2007 @ 7:36am

Synergy
I am going to file a copyright/patent on my personal information. Anyone (including credit companies) that wnat to exploit my personal IP must then may me a license fee.

Just to keep it reasonable, I will only charge $10,000 per use for a non-exclusive license to use my IP on one machine for one user, and only $5,000 for each subsequent user.

I can join the MPAA and RIAA, and have them sue people world-wide, and get the FBI to raid the spammers.....

Sorry -- I was in an aleternate universe where "real people" actually have rights.
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TheDock22, 22 Feb 2007 @ 7:39am

Wamu
Or you could get a Providian/WaMu credit card. I have a l Visa through them and I get my credit report and score for free whenever I want it by logging into my account.
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jimdamico, 22 Feb 2007 @ 7:51am

My Experience...
I joined freecreditreport.com about a year ago. There was a 30 day free trial which, when expired, turned into a month by month subscription at about $13/month. I pulled my credit, found a discrepancy, and had it taken care of. It was nice having my score available, and the site is easy to use and has a lot of good info. I kept the account open and have payed the monthly subscription ever since. If a credit inquiry goes on my account I am emailed immediately. I find it nice having the piece of mind as well as monitoring my score. I have been able to raise it over 50 points just be being AWARE of how it works. Sure, I was naive prior to joining, but it opened my eyes and has helped me tremendously.

One thing I do agree with is the comment about having the annualcreditreport.com link on the page and clearly explained that we get one free report from each agency per year. That is not clearly explained anywhere I have seen on freecreditreport.com. I have paid about $25 each time I want a full report from all three agencies.

Is it true that the report is free (1/year) but the score is not?

-jim d
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Rich Kulawiec, 22 Feb 2007 @ 9:20am

And as if that wasn't enough...
They're spammers. I've permanently blacklisted;

consumerinfo.com
creditexpert.com
experianconsumerdirect.com
exprpt.com
freecred italerts.com
freecreditreport.com
icreditreport.com
iplace.com
promisemark.com
qspace.com
webc reditreport.com

as a consequence.
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Old man, 22 Feb 2007 @ 1:12pm

Experian, Equifax and Trans-Union suck. They won't fix mistakes on people files beucase they simply do not give a damn.
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Yorick, 22 Feb 2007 @ 1:52pm

the scam works
See, even in this thread two people have confused freecreditreport.com (a pay site that reams you), with annualcreditreport.com - the real site.
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Anonymous Coward, 22 Feb 2007 @ 3:35pm

Sadly, people believe that it's "un-American" to let people view the information that these companies had about them for free."

I think that the right to free annual credit reports from each of the three major reporting companies varies by state.

I live in NJ and it's the law here.
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Anonymous Coward, 22 Feb 2007 @ 5:43pm

Re: Re:
You are also correct on the "makes no sense part" but it's not a fault with the post, it's with the FCC.
How is the fault with the FCC? I thought the FTC supposedly regulated these people.
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Anonymous Coward, 22 Feb 2007 @ 5:48pm

Re: Stiffer Penalty
Oobviously the laws aren't working.
On the contrary, the laws are working exactly the way they were actually intended. You're just not supposed to realize it.
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Anonymous Coward, 22 Feb 2007 @ 5:54pm

Re: A Proper Punishment
Credit bureaus are in desperate need of tighter regulation, and, being very much pro-business, it's not easy for me to state that. But, the power they have over the lives of consumers and the apparent lack of due diligence they exhibit in maintaining accurate data makes me agree to a much tighter regulatory environment for this industry.
They need to have the special laws that protect them from liability for their mistakes repealed. What we are seeing is the result of another industry exploiting its special government protection in the market.
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Anonymous Coward, 22 Feb 2007 @ 5:56pm

Re:
I think that the right to free annual credit reports from each of the three major reporting companies varies by state.
You think wrong. It's a federal law.
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Gemini, 23 Feb 2007 @ 8:36pm

Re: Re:
https://www.annualcreditreport.com/cra/helpfaq#statelaw

"Am I entitled to a free credit report under state law?

In addition to consumers who are eligible for a free credit report through the Annual Credit Report Request Service; consumers in some states are eligible for a free credit report under state law. The following states have laws that make free credit reports available to consumers: Colorado, Georgia, Maine, Maryland, Massachusetts, New Jersey and Vermont."
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Ike Dent, 24 Feb 2007 @ 4:02am

Credit reports for free- UN American
The real fraud here is the fact that these agencies are gathering your information and selling it back to you.

Most people don't realize this. The credit reporting industry is filled with blue suede shoe boys and needs to be selling junk used cars rather than dealing with the hard working people of America's lives.
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A Moron in a Hurry, 24 Feb 2007 @ 4:42pm

See, even in this thread two people have confused freecreditreport.com (a pay site that reams you), with annualcreditreport.com - the real site.

Hey, maybe there should be some sort of law restricting someone's ability to use the name of your company if it sounds too similar ...
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Charlee, 4 Mar 2007 @ 2:39pm

The Credit Bureaus Are Deadbeats!
I went online last year and got free credit reports, 1 from each bureau. When I tried repeat this miracle this year, my (same) password would not work and I could not start as a new user on the site. I wound up using the telephone request process, and have my fingers crossed that it works. As corporate crooks, they rank second only to DELL COMPUTERS.

I shudder to think that they are in charge of managing my credit history and are allowed free reign to do this year after year, no matter HOW MANY people complain. I think I'm going to write my State Sentor.
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ds, 19 Apr 2007 @ 11:48am

The credit companies don't alert you when THEY make a mistake moron. They alert you when someone steals your identity or when someone checks your credit etc. Get your facts straight before you write bullshit.
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Operator, 1 Dec 2008 @ 1:39pm

Should have read this review first...
... instead, I've added $14.95 to FreeCreditReport.com's coffers.

Account cancellation took three tries to their customer service line (1-877-481-6826) ... and I'm still not certain the account is closed.

First try: Pressed "1" for cancellation, on hold for a minute, received a "call cannot be completed as dialed" message.

Second try: Pressed "3" for customer service, then "2" to speak to a representative. Received a busy signal.

Third try: Pressed "1" for cancellation (had to give it another try - this was my due diligence before calling my credit card issuer to charge back the subscription fee) and actually spoke to a rep.

Problems with the conversation: Rep wanted my full social security number to confirm my identity (while I do not doubt that this information was readily available on her computer, I try to avoid tossing around my full social security number in situations which may facilitate it being written down).

Rep was either unwilling or unable to provide a confirmation number for the call - I have no "proof" that I canceled and am left waiting for an e-mail which confirms my account cancellation.

FreeCreditReport.com - Stay far, far away.
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john, 5 Jan 2009 @ 8:09am

freecreditreport.com
I agree with all other respondents and admit I was scammed just like them. As I am writing this I have been on hold for a second time with their customer care line. First time was 45 minutes with no response and now another 20 minutes. I have already called my credit card people to report this. They say I must wait until the charge hits my account since my 9 day free period has not expired. BEWARE!!!!!!!!
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john, 5 Jan 2009 @ 8:09am

freecreditreport.com
I agree with all other respondents and admit I was scammed just like them. As I am writing this I have been on hold for a second time with their customer care line. First time was 45 minutes with no response and now another 20 minutes. I have already called my credit card people to report this. They say I must wait until the charge hits my account since my 9 day free period has not expired. BEWARE!!!!!!!!
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ED, 26 Jun 2009 @ 10:58am

Total Scam, never ending!
We were scammed by mini*creditreport.com and lost over $100. YOu can't call this company on their 800 without getting a great deal of help. YOu get loud noise, no live person. It's a scam. Call the Federal Trade commissioner, 877-382-4357. This company has scammed scores of people!
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M Horton, 8 Jul 2009 @ 11:04am

Credit companies right to do anything
I don't know who gave these guys the right to report anything!!!!! They were just list brokers back in the early '80's, and as far as I'm concerned, that's all they are now!
Get rid of your credit cards, drive your car for a few more years, and guess what ----- they aren't shit. I don't care if they give me a 500 score - it's irrelevant.
Signed, Don't Care
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american citizen, 25 Jan 2010 @ 10:02am

credit disclosure scam
This concerns Equifax.
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american citizen, 25 Jan 2010 @ 10:07am

credit disclosure scam
This concerns Equifax. After trying all the telephone numbers given to get a free credit report, I called the company directly who aparently outsource using people who do not understand or care about your problem. After I was told to write the information services giving my personal ID info I would get my free report. HA!! They sent back a form letter stating stating they need copies of my ID and my free report would cost me. So now I will be another person who reports them to the FTC and hope to have better luck than all the above complaints I have read.
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