Main Street

Doubly Unfree Credit Report

Now, Free Credit Report was never really free, in the sense that getting your “free” credit report signed you up for an ongoing monthly service that was definitely not free.

But now even the part that was allegedly free—the initial credit report—costs a dollar. That’s not a lot, and they even donate it to charity. Which makes no sense at all, now does it?

It does in this context. Free Credit Report was fined $1.25 million for being misleading about the freeness of its service, and it kept on keeping on. But then new regulations were put in place:

The new F.T.C. rules went into effect on April 2, and they required sites to include a prominent notice across the top of each Web page that mentioned free reports declaring that the only authorized source under federal law for such reports is annualcreditreport.com.

Rather than include such disclosures, Experian added the $1 charge, saying that “due to federally imposed restrictions, it is no longer feasible for us to provide you” with a free credit report. And now that the report costs $1, the new F.T.C. rule would presumably no longer apply.

Or would it? Rebecca E. Kuehn, assistant director for the division of privacy and identity protection at the F.T.C., declined to comment on any particular company. But she pointed to language in the new rules stating that they apply to any company that “either expressly or impliedly” offers a free credit report to a consumer and ties it to enrollment in a paid service or product.

Expressly or impliedly like, say, calling your site “Free Credit Report”? One would think.

We’ll see how the FTC follows up on this maneuver.

Tags: financial regulation, predatory economy