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FTC Launches Its Own Commercial

By Faye Mergel
Published: Wednesday, November 4th, 2009

It is aired on television several times a day: three shabby musicians regretting how debt has ruined their dreams, singing a jingle on how it could have been avoided if they checked their credit report regularly through freecreditreport.com. People who subscribe to the site do get access to their own credit reports, but not for free. In an effort to keep consumers from being misdirected, the Federal Trade Commission launched its own commercial and groomed its own set of three shabby singers.

FTC Launches Its Own CommercialFTC told the public that if they want their credit report for free, they should go to annualcreditreport.com. The commission said it   has received complaints from consumers who thought they were getting the annual free credit report guaranteed to them by federal law when they signed up with freecreditreport.com. But they received an additional bill on their credit cards for services they do not need.

FTC reminded consumers that the Fair Credit Reporting Act guarantees them free access to their credit report with from the three major credit bureaus in the country—Experian, Equifax, and TransUnion. Representatives said consumers can request for their reports via phone, mail, or through the internet.
The commission launched two online ads to raise awareness about annualcreditreport.com, the only site backed by federal government. FTC hopes that it will go viral so consumers will not be misdirected to commercial sites such as freecreditreport.com which earn millions of dollars from their confusion.

The ads are spoofs of commercials earlier launched by freecreditreport.com. New York Times reported that FTC is targeting the Experian-owned site because it believes that the company deliberately misleads people to their domain. The agency further believes that freecreditreport.com is using free credit reports as a bait to lure people into credit-monitoring services which cost $14.95 each month.

The newsgroup also reported that Experian is earning $650 million to $750 million each year from 9 million people who did not know that their credit cards will be billed if they subscribe to the site.

To keep consumers from being misled, FTC proposes that commercial websites inform consumers upfront that they are not the official website sponsored by the government and that their services require payment.

As of present, such websites only inform consumers about the payment conditions on fine prints. The agency also proposes that those sites create a separate page on their domain reminding people that the only true source of free credit reports is annualcreditreport.com.

Meanwhile, the Democrat representative from New York, Senator Charles Schumer, suggests that the FTC mandate websites like freecreditreport.com to give consumers their credit reports first before asking for their credit card number.

FTC encourages consumers to comment on the proposals.

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