November 12, 2009


Next month marks the fifth anniversary of the "free credit report" legislation (which enables all consumers to obtain a free credit report from each of the three (Equifax, Experian, and TransUnion) major credit reporting agencies annually). Unfortunately, the misleading freecreditreport.COM ad campaign has been much more visible to consumers than the legitimate free credit report site of the government, located at ANNUALCREDITREPORT.COM ...

I was pleased to see Ron Lieber's "A Free Credit Score Followed by a Monthly Bill" article in the New York Times this past week. He does a nice job outlining the pitfalls of (a "service" that not coincidentally is owned by Experian -- one of the major credit reporting agencies). Most notably, people are often unknowingly "signing up" for a $14.95/month credit monitoring service as part of their "free" credit report offer. Don't believe me? Then you must believe that their monitoring services are vastly superior to the competition's services since they own more than twice the market share of the next three largest credit monitoring players combined! In addition, although Experian doesn't share information about subscription turnover, Lieber reported that the average enrollment of a monitoring subscriber was under a year. Not the sound of an intentional purchase.

Apparently the Federal Trade Commission is not buying the pitch either. They have long believed that consumers are being deliberately led away from the "real" free credit report offered by the government and that Experian is profiting from the confusion created (somewhere in the ballpark of $700M per year; not bad given the $54M they spent on the TV and radio spots last year). Recently, to combat the catchy TV jingle, the FTC came up with their own jingles and misleading URL - freecreditreport.GOV ... Nice job FTC!!

"Other sites may turn your head; they say they’re free, don’t be misled. Once you’re in their tangled web, they’ll sell you something else instead."

Their full video ads are below...