The Federal Trade Commission revealed recently that it is sending more than $2.5 million to consumers who were said to be “misled” by “deceptive claims” from credit services company Credit Karma.
The FTC reportedly took action against Credit Karma back in 2022, alleging that the firm had told consumers they were “pre-approved” and had “90% odds” or chances of approval to entice them to apply for credit card offers that, in many instances, they “ultimately did not qualify for.”
It’s worth noting that like many other companies, Credit Karma has increasingly been relying on automation to communicate with clients. Due to a very high level of automation, consumers receive receive messages that can be outdated, completely irrelevant, or even inaccurate (like the number of successful credit card payments made and the consumers’ actual credit score).
Credit Karma had reportedly agreed to an FTC order that required the company to “stop making these types of deceptive claims and to pay money to compensate consumers who were harmed.”
Recently, the FTC confirmed that is now sending this money back to the impacted consumers.
The FTC stated that it is sending out checks as well as PayPal payments to 50,994 consumers who filed “a valid claim before the March 4, 2024 deadline.”
The FTC further noted that consumers should cash their checks “within 90 days, as indicated on their check, or redeem their PayPal payments within 30 days.”
As noted in the announcement, consumers who have questions about their payment should contact the administrator, JND Legal Administration, or alternatively review the FTC’s official website to view frequently asked questions regarding the refund process.
As clarified in the update from the US regulatory authority, the Commission stated that it “never requires people to pay money or provide account information to get a refund.”
The Commission’s interactive dashboards for refund data aim to “provide a state-by-state breakdown of refunds in FTC cases.”
Last year, FTC actions had reportedly “led to $330 million in refunds to consumers across the country.”
The Federal Trade Commission (FTC) has explained that it works to promote competition and “protect and educate consumers.’
The FTC clarified that it would “never demand money, make threats, tell you to transfer money, or promise you a prize.”
