Rob McKenna (R)
WASHINGTON (Legal Newsline)-The Federal Trade Commission needs to do more to strengthen consumer protections to prevent deceptive marketing of so-called free credit reports, 42 state attorneys general said in a letter to regulators.
While the bipartisan group of attorneys general said they support several of the changes proposed by the FTC, they would like to see regulators adopt more stringent disclosures.
"We believe that advertising restrictions and mandatory disclosures are necessary to ensure that consumers are not misled or confused by advertisements and offers for 'free' credit reports and are able to easily obtain their free annual credit reports," the letter sent this week said.
Federal law allows consumers to obtain one free credit report from each of the three major bureaus: Equifax, TransUnion and Experian. Consumers may request a report at www.annualcreditreport.com or by calling 1-877-322-8228.
But there are sound-alike Web sites where consumers can be misled, the attorneys general said in their Dec. 7 letter. They point out www.freecreditreport.com, which is owned by Experian, as an example.
"Consumers file complaints stating they did not understand that by accessing their free credit report, they had signed up for a service that automatically charged a specific amount per month for credit monitoring," the attorneys general wrote.
The Federal Trade Commission is proposing that television and radio commercials for "free" credit reports must disclose: "This is not the free credit report provided for by federal law."
The states, however, want advertisers to go a step further, and include the statement: "This report is only free if you make a purchase."
Print and Web ads would require similar disclosures and list the phone number and Web site for requesting the government-mandated free reports.
The attorneys general and the FTC also want to ban hyperlinks to commercial Web sites from www.annualcreditreport.com and prohibit marketing for paid services or products until after a consumer has received the free credit report.
Washington Attorney General is among the letter's 43 signatories. He said in a statement that more needs to be done to protect consumers.
"Credit reports are crucial in helping consumers detect whether they've become victims of identity theft or credit fraud," McKenna said. "Credit reporting agencies are required to provide you a free copy of your report, but some see this as an opportunity to sell additional products. Under the law, 'free' means 'at no cost,' not 'free with a purchase.'"
The AGs' letter was sent by the National Association of Attorneys General, of which McKenna, a Republican, is the vice president.
Signatories on the letter in addition to McKenna were the attorneys general of: Alabama, Arizona, Arkansas, California, Colorado, Connecticut, Delaware, Guam, Hawaii, Idaho, Illinois, Iowa, Kansas, Kentucky, Louisiana, Maine, Maryland, Massachusetts, Michigan, Minnesota, Mississippi, Missouri, Montana, Nevada, New Hampshire, New Jersey, New Mexico, New York, North Carolina, North Dakota, Ohio, Oklahoma, Oregon, Pennsylvania, Rhode Island, South Carolina, South Dakota, Tennessee, Texas, Utah, Vermont and West Virginia.
From Legal Newsline: Reach staff reporter Chris Rizo at firstname.lastname@example.org.