New rules for credit monitoring services went into effect April 2. The regulations require companies that offer credit monitoring services to add warning labels about their services.
Websites offering “free” credit reports must now tell consumers that a free credit report is available at AnnualCreditReport.com or by calling a toll-free number. In addition, the websites must offer clickable links to the FTC and AnnualCreditReport.com websites. Starting September 1, radio and television ads must also carry the disclaimer. Since 2003, consumers have been allowed to get one free credit report per year.
These regulations are aimed at the explosion in credit monitoring services, which typically entice consumers with a free credit report. Once consumers sign up for their free report, and their trial period ends, they are left with a subscription to a credit monitoring service, which then notifies customers if there are any changes on their credit reports.
Following the changes, Experian (one of the three major credit reporting bureaus, along with TransUnion and Equifax) began charging $1 for credit reports offered on its website FreeCreditReport.com and donating that money to charity in order to avoid the FTC rules.