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WASHINGTON-The Federal Trade Commission announced a settlement of charges against Consumerinfo.com, Inc. for deceptively advertising “free” credit reports without disclosing other charges. Specifically, the company did not inform consumers that they would be automatically enrolled in credit report monitoring for $79.95 if they did not cancel within 30 days. The settlement requires Consumerinfo to pay redress to deceived consumers, bars deceptive and misleading claims about “free” offers, requires disclosure of terms and conditions of any “free” offers, and requires the defendant to give up $950,000 in ill-gotten gains to the commission, which may be used to provide consumer education. The settlement also contains record-keeping and bookkeeping provisions to allow the FTC to monitor compliance with the order. Consumerinfo.com., Inc., doing business as Experian Consumer Direct, Qspace, Inc., and Iplace Inc. is a wholly-owned subsidiary of Experian North America, the parent company of Experian Information Services, one of the three national credit reporting companies. Consumerinfo used radio, television, e-mail, and Internet ads to draw people to their Web sites, then asked for a valid credit card account number to get their credit report. The company assured, “Your card will not be charged during the free trial period. However, valid credit card information is required to establish your account.” Consumerinfo billed these credit cards and, in some cases, automatically renewed memberships without notice. The FTC charged that the defendant’s failure to adequately disclose the automatic billing and obtain consumer consent to bill their accounts violated federal law. FTC also alleged that Consumerinfo misled consumers about its association with the annual free credit report program established under the Fair and Accurate Credit Transactions Act. “It’s unfair and deceptive to promise consumers something for free and then trick them into paying for products they didn’t want in the first place,” FTC Bureau of Consumer Protection Director Lydia Parnes said. She added, “Consumers also need to be alert about impostor sites – sites that misspell annualcreditreport.com or use sound-alike names, but don’t link to the authorized site. We are sending letters to operators of more than 130 impostor sites to inform them that we know they are out there and that attempts to mislead consumers are illegal.”

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