The company convinced people to apply for cards that harmed their credit
More than $2.5 million is being paid to Credit Karma customers who were deceived into applying for credit cards that harmed their credit, the Federal Trade Commission said Thursday.
The funds heading to nearly 51,000customersare a result of the FTC's regulatory action against Credit Karma in 2022.
The FTC alleged that Credit Karma, which offers free credit scores and monitoring in exchange for personal data, misled customers into thinking they were going to be approved for credit cards and to apply, which damaged the credit of tens of thousands of people.
For instance, the FTC said Credit Karma used language such as "pre-approved" and "90% odds" to get them to apply for offers the company knew theydidn't actually qualify for.
Credit Karmas false claims of pre-approval cost consumers time and subjected them to unnecessary credit checks, said Samuel Levine, director of the FTCs Bureau of Consumer Protection.
Credit Karma agreed to pay millions and to stop making suchclaims to resolve the dispute with the FTC.
The company collects more than 2,500 data points on each customer, including on their personal finances,and uses that information to serve targeted advertisements for financial products such as credit cards, the FTC said.
Credit Karma is owned by Intuit, which also owns Turbotax and Quickbooks.
Photo Credit: Consumer Affairs News Department Images
Posted: 2024-10-31 16:37:01
