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Credit Bureaus to reform advertisements

By Faye Mergel
Published: Wednesday, May 5th, 2010

AGERM-00472620-001Everyone who grew up in the United States would have fond memories of those exciting advertisements on TV and other mass media from websites proposing to help them handle their credit reports more carefully in almost all cases consumers have been hoaxed into credit monitoring schemes.

“The Federal Trade Commission has received complaints from consumers who thought they were ordering their free annual credit report, and yet couldn’t get it without paying fees or buying other services,” an FTC spokesperson was quoted as saying. The Federal Trade Commission on their website said customers who were enrolled in “Free credit report” are surprised to find they are debited $15 on their accounts and that they are enrolled in credit monitoring and other utilities.

Consumers were enrolled into trial credit report schemes but were not well informed bout the working of the scheme in itself. Consumers had to cancel their subscription within a fixed time period in order to avoid being charged for services. Consumers were not aware of this time period as companies hold back information from them and the customers do not pay attention to the fine print which leads to fraud.

Clear and precise product description

The Federal Trade Commission passed a bill which prevents companies from enrolling consumers under false pretences through their “free credit report” advertisements. Obama’s 2009 (Credit Card Accountability Responsibility and Disclosure) CARD Act, expects Credit Bureaus to show a warning label stating “You have the right to a free credit report from or 877-322-8228, the ONLY authorized source under federal law.”

The label requires companies to show links to TV and other media advertisements are expected to follow this rule September 1st onwards. Free of charge, credit reports with no other services involved are available at Consumers can also get free credit report, free of charge credit reports, one free from each major Credit Bureau yearly, namely TransUnion , Equifax and Experian.

Other sites are to change the specifications for their advertisements in order to suit the requirements of the new CARD Act. Credit Bureaus will now reduce the price of a “Free” credit report or offer new schemes similar to credit reports to work around the new rule.

The Credit Card Accountability Responsibility and Disclosure Act of 2009 is the change consumers needed in credit card management services and to prevent credit card fraud.

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