Bankruptcy

Financial News This Week: More Consumer Protection

By Meaghan Olson

The FTC has recently settled several cases relevant to consumer protection and financial stability. Here?s a summary of those cases and how they may impact you.

LifeLock Pays $12 Million, Stops Deceptive Claims

Not long ago, LifeLock ran a campaign offering comprehensive protection against identity theft for consumers. However, the FTC reports that 35 states? Attorneys General challenged those claims, since the protection LifeLock offered was less than stellar.

In its ads, LifeLock claimed that it:

• Guaranteed protection against identity thieves ever getting their hands on subscribers? information
• Was the first company to offer such complete and comprehensive protection
• Stopped identity theft before it occurred
• Stored all personal data in encrypted electronic files
• Gave access to sensitive information only to secured individuals
• Used ?highly secure? protection (physical, electronic and managerial) to prevent fraud

These services were offered for the price of $10 per month. Because these claims somewhat overstated the actual protection the company offered, many consumers lodged complaints and now LifeLock is prohibited from advertising services they can?t actually offer.

Refund Checks Coming to Victims of Health-Related Scams

The company Roex, Inc. reportedly sold a range of products, including infrared saunas and dietary supplements, which they claimed would cure or alleviate symptoms of numerous serious diseases.

But the results didn't match the advertisements, and the FTC has ordered the company to make payments to past customers. The average amount of the refund check is $500.

Consumers who bought products from Roex, Inc. should be on the lookout for these checks, mailed March 5, 2010, and deposit or cash them ? they are not a scam. The FTC notes that 5,700 checks were mailed, with a total value near $3 million.

Credit Repair Scammers Settle with the FTC

An Illinois-based credit repair scammer has recently come to a cash settlement with the FTC for falsely indicating to consumers that it could remove negative entries on their credit reports, even if they were accurate and current, which violates federal laws. Some consumers who filed bankruptcy were targeted by the scam.

To avoid credit repair scams, keep in mind:

• Accuracy isn?t negotiable: Correct information on your credit report cannot be legally removed for seven years.
• Don?t pay upfront: If someone asks for money before performing a service, watch out.
• There?s no easy fix: Credit repair takes time and diligent effort. Shortcuts will only get you way off the track.

Full post as published by The Bankruptcy Blog on March 19, 2010 (boomark / email).