| Wednesday April 23rd 2014

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“Free” credit report site disclosures now mandatory


It pleases me to learn that a new Federal Trade Commission regulation went into effect requiring those sleazy sites like Freecreditreport.com to display this disclosure:freecreditreport.com charity

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 regulation went into effect on April 2, but Freecreditreport.com doesn’t have the disclosure on its home page. It does have a curious notice in the form of a .gif (no text), though.


So, for starters, Freecreditreport.com isn’t even free anymore. But, more than that, this notice doesn’t make a lot of sense. The company says it can no longer provide a “free” credit report (thanks to the mean ol’ gubmint) and must now charge a dollar. But then it says it will give the dollar to charity. Huh? I have a feeling something else is going on here. I’m only guessing, but I suspect the real reason they charge a dollar is to make sure the credit card number it asks for (before giving you your report) is valid. (Freecreditreport.com uses the card number to charge you $14.95 a month for its lame “Triple Advantage” program). It could be that some people had been signing up using phony credit card numbers that they generated from a site like this. These numbers will pass a local pre-validation check, but will fail when a merchant actually tries to process a charge against the card number. So now the company is charging a dollar to make sure the card is valid. Do you have a better theory? I’m all ears.

UPDATE: By charging $1, Freecreditreport.com can avoid FTC’s new disclosure regulation for “free” credit reports. This is a much better theory than mine.

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