FOR IMMEDIATE RELEASE
Contact: NYS Consumer Protection Board
Phone: 518-486-4852
Fax: 518-474-2474
Agency Twitter: @NYSConsumer

DATE: December 17, 2009

NYS Consumer Protection Board Calls on Federal Regulators to Strengthen
Proposed Rule Against Deceptive Marketing of Credit Reports

- CPB Proposes Rule Amendments to Help Consumers Better Understand and
Evaluate
Offers for ?Free? Credit Reports -

The New York State Consumer Protection Board (CPB) is urging the Federal
Trade Commission (FTC) to revise proposed amendments to the Free Annual
Credit Report File Disclosures Rule, also known as the Free Credit Report
Rule, to better protect consumers against the deceptive marketing of
credit reports and provide for more prominent disclosure.

The CPB believes that the most significant risk of deceptiveness comes
from the manner in which some commercial businesses advertise their ?free
credit report? offers to the public. Some consumers who responded to these
advertisements complain they did not understand that accepting a ?free
credit report? also meant automatically signing up for credit monitoring
or other similar service, and they were shocked when their acceptance of
this ?free? offer resulted in a monthly charge to their credit cards. The
CPB highlights that in these cases, the advertisements and presentations
fail to set clearly and conspicuously at the outset of the offer all the
terms, conditions and obligations upon which receipt and retention of the
free credit report is predicated to leave no probability that the offer
might be misunderstood by the consumer. The CPB called on the FTC to
supplement its proposed amendments with rules prohibiting the deceptive
use of the word ?Free? in these advertisements and presentations.

?Some commercial marketing of credit reports has mislead consumers who
thought they were accessing their free credit report only to have signed
up for costly services, which they did not intend to purchase,? said
Governor David A. Paterson. ?It is important that free credit report
advertising rules be changed to aid consumers in making a more informed
choice about purchasing extra services beyond receiving their free
report.?

The FTC?s proposed amendments require in part, that online, print and
television ads for free credit reports carry the following notice: ?This
is not the free credit report provided for by Federal law.? In its letter
to the FTC, the CPB called on the federal agency to require that this
notice be prominently placed within all advertisements. ?In the case of
print ads, the notice should be presented in a box and/or in a contrasting
color to help ensure its prominence. The CPB also proposes that the notice
requirement be applied in all non-traditional advertising contexts,? said
Mindy A. Bockstein, Chairperson and Executive Director of the CPB.

Thus, where a consumer calls to place a fraud alert on their credit report
and receives a solicitation to purchase company services that include
?free credit report? offers, the consumer should be advised that this is
not the free credit report provided for by federal law and that it may
require a purchase.

The CPB supports the FTC?s proposal that when consumers visit a website
where ?free? credit reports are offered they would be automatically sent
to a separate landing page where they could choose to continue to the
commercial site or instead visit www.AnnualCreditReport.com.

?Access to credit reports is vital for consumers to be able to determine
if they were the victim of identity theft and to conduct periodic
financial checkups,? said CPB Chairperson and Executive Director Mindy A.
Bockstein. ?The CPB?s proposed changes reflect a response to the numerous
complaints and inquiries the Agency has received and, we believe, will
provide the type of disclosure that will help educate consumers on the
distinction between the free annual credit reports to which they are
entitled and the free credit reports that are accompanied by other ?for
fee? services or products.?

Under the Fair and Accurate Credit Transactions (FACT) Act, consumers are
allowed one free credit report a year from each of the three major credit
reporting agencies. Consumers can request their free report by visiting
the actual free federal website www.AnnualCreditReport.com or by calling
1-877-322-8228.

As part of the CPB?s identity theft prevention and mitigation efforts and
its promotion of financial literacy, the Agency encourages consumers
through educational materials, which can be found at www.nysconsumer.gov,
and presentations to take advantage of the federal law to obtain free
credit reports. The CPB advises consumers to stagger their requests for
their reports to the three major reporting agencies throughout the year to
see a snapshot of their credit history and check them for accuracy.

The CPB, established in 1970 by the New York State Legislature, is the
State's top consumer watchdog and think tank. The CPB's core mission is to
protect New Yorkers by publicizing unscrupulous and questionable business
practices and product recalls; conducting investigations and hearings;
enforcing the Do Not Call law; researching issues; developing legislation;
creating consumer education programs and materials; responding to
individual marketplace complaints by securing voluntary agreements; and,
representing the interests of consumers before the Public Service
Commission and other State and federal agencies.

- 30 -

To file a consumer complaint with the NYS Consumer Protection Board (CPB),
call our toll-free hotline at 1-800-697-1220 or visit the CPB?s website at
www.nysconsumer.gov. In addition to the online complaint form, the website
is home to important consumer safety information and resource.

Jorge

Jorge I. Montalvo
Director of Strategic and Virtual Consumer Programming
NYS Consumer Protection Board
Ph: +1 (518) 486-3703
Twitter: @jorgeimontalvo

CONFIDENTIALITY NOTICE: This e-mail communication and any attachments may
contain confidential and privileged information for the use of the
designated recipients named above. If you are not the intended recipient,
you are hereby notified that you have received this communication in error
and that any review, disclosure, dissemination, distribution or copying of
it or its contents is prohibited. If you have received this communication
in error, please notify me immediately by replying to this message and
deleting it from your computer. Thank you.