Legal News

Catchy Tunes, But Is the Service Bogus?

By Ashby Jones

You know the ads. This twenty-something hipster dude with a guitar singing about his financial troubles. In one ad, he’s working at a seafood restaurant and is dressed as a pirate. In another, his troubles force him to live with a skinhead named Fang “in a soggy cardboard box.” Had our sadsack troubadour only checked his credit via Experian’s FreeCreditReport.com, the commercials say, he could have avoided his woe.

But, according to a lawsuit recently filed by a Wisconsin woman, had the singing pirate actually done as he says he wished he had, he might have wound up an an even deeper financial hole.

The story: Erica Possin, a Wisconsin college student is suing the credit-reporting agency Experian, alleging that the ads are misleading and fraudulent. Click here for the story, from Huffington Post; here for the complaint.

According to the complaint, Possin wanted to check her credit before buying a new car, and wen to FreeCreditReport.com. But she got her “free” credit report only after inadvertently signing up for a $14.95 monthly credit monitoring service.

In Possin’s mind, this was bogus. Her putative class action lawsuit seeks to “stop the fraud and seek compensation for the tens of thousands of consumers deceived by Experian’s FreeCreditReport.com to the tune of millions of fraudulently obtained profits.”

The complaint notes that the Federal Trade Commission has repeatedly won settlements from Experian for its advertising, but that Experian has declined to change their ads.

But in a statement to HuffPo, Experian made it clear they’re not going to roll over. The statement reads:

FreeCreditReport.com is a trusted partner for millions of Americans who want more than a free credit report. We make it very clear to consumers visiting the site that the free credit report and score is part of enrollment in the Triple Advantage Credit Monitoring and that if they don’t cancel their membership within the seven-day trial period, they will be billed monthly. While it wouldn’t be appropriate to speculate what the FTC’s final rules will be, we can tell you we remain committed to clearly and conspicuously disclosing to consumers that the free report we offer is not the free annual credit file disclosure provided by federal law.

Full post as published by Law Blog - WSJ.com on February 09, 2010 (boomark / email).