May 28, 2009
FAREWELL... Renaissance Fair Rocker
The credit card reform bill signed into law by the president on Friday won't just put a stop to several unfair practices of the credit card industry -- it also targets misleading advertisements for phony "free" credit reports.
The "free credit report" advertised non-stop on cable television, it bears repeating, isn't free at all. The law calls for the Federal Trade Commission to issue new rules that will force free credit report advertisers to inform consumers that the only place for a free credit report is AnnualCreditReport.com.
Television and radio ads will also be required to include a pretty deflating statement: "This is not the free credit report provided for by Federal law."
It's hard to see how the FreeCreditReport.com's Renaissance Fair Rocker will fit that one into his rhymes about pointy slippers and green wool tights.
Under the Bush administration, the FTC repeatedly fined the folks behind freecreditreport.com for deceptive advertising, since you only get the "free" report after enrolling in a $15-a-month credit monitoring program. But the fines amounted to mere wrist-slaps.
The new rule is good news for consumer advocates.
For too long, FreeCreditReport.com has taken advantage of a weak consent decree negotiated by the Bush FTC that has let it confuse consumers into buying its over-priced, unneeded subscription credit monitoring product that isn't free. Consumers have wasted millions buying a service that doesn't prevent identity theft and doesn't raise your credit score, sold by one of the companies whose sloppy practices make identity theft easy and keeping your credit score accurate, harder.