Have you ever been denied credit, goods, benefits, services, employment and/or insurance? Do you have a problem with “free” credit reports that are often bundled with credit scores and/or credit monitoring services and steep monthly fees? If so, you are not alone.
As part of the Credit Card Accountability, Responsibility and Disclosure Act of 2009 (commonly referred to as the Credit Card Act of 2009), advertisements for credit reports will soon require enhanced disclosures to help consumers avoid confusing “free” offers. These offers often require consumers to spend money on credit scores and/or credit monitoring while the “no-strings-attached” credit reports available through the central source at www.AnnualCreditReport.com are truly free to consumers once every 12 months
Effective April 1, 2010, the Federal Trade Commission’s Free Credit Reports Rule will require a prominent and enhanced disclosure in advertisements for “free” credit reports. Specifically, all Web sites offering “free” credit reports must include – across the top of any page that mentions them – a disclosure stating:
THIS NOTICE IS REQUIRED BY LAW. Read more at FTC.GOV You have the right to a free credit report from AnnualCreditReport.com or 877-322-8228, the only authorized source under federal law.
The Web site disclosure must include a clickable button to “Take me to the authorized source” at www.AnnualCreditReport.com as well as clickable links to the Federal Trade Commission Web site at www.ftc.gov.
Under recent legislation, the Credit Card Act of 2009 required the Federal Trade Commission to issue a rule to prevent deceptive marketing of “free” credit reports. Specifically, the Act requires that certain advertisements for “free” credit reports include prominent disclosures designed to prevent consumers from confusing these so-called “free” offers with the federally mandated “free” annual credit reports available through the “centralized source,” which is www.AnnualCreditReport.com.
The Federal Trade Commission proposed amending the rule in late 2009 and received more than a thousand comments from consumers, consumer reporting agencies, consumer report resellers, business and trade organizations, state attorneys general, consumer advocates, law firms, members of Congress, and academics. Most of these comments were in favor of change and enhanced disclosure requirements.
The amended rule also restricts practices that might mislead or confuse consumers as they attempt to obtain their federally mandated “free” annual credit report. The consumer reporting agencies of Equifax, Experian and TransUnion will now be required to delay the advertising of any products and/or services at the central source until the consumer has successfully obtained their “free” annual credit report.
Except for the wording of the disclosures for television and radio advertisements, which takes effect on Sept. 1, 2010, the new rule is effective April 1, 2010. The Federal Trade Commission will monitor and evaluate the effectiveness of the amended rule as well as the required disclosures and may consider additional changes as deemed necessary in the normal course of affairs.
Information contained in credit reports may determine whether a consumer can obtain credit, goods, benefits, services, employment and/or insurance. As such, it is important that consumers review their credit reports and correct any information that is inaccurate, erroneous, obsolete, and/or fraudulent. Under the Fair and Accurate Credit Transactions Act, Equifax, Experian and Trans Union are required to provide consumers with a “free” annual credit report once every 12 months, but only upon request. To learn more about their right to a “free” credit report under federal law, consumers are encouraged to visit the Federal Trade Commission website at http://www.ftc.gov/freereports.
William E. Lewis Jr., is a credit repair expert with Credit Restoration Consultants and host of “The Credit Report with Bill Lewis” on AM 1470 WWNN, a daily forum for business and financial news, politics, economic trends, and cutting edge issues.