Identity theft is a serious subject, and according to recent reports, it's a growing problem. Because identity theft is out of control (personal opinion) and has victimized a lot of people, it's spawned a cottage industry that sells protection at a price. Critics, including the FTC, believe a lot of these identity theft companies are selling services that are supposed to be free.
If you've watched TV in the past year, you've probably seen the ads for FreeCreditReport.com. These ads have urban minstrels (guitar dudes) singing about the woes of people who have had their identities stolen or made poor credit choices. The idea is to get you to go to FreeCreditReport.com, which isn't exactly free. If you read the fine print when you sign up at this site for your free credit report, you are actually authorizing them to bill your credit/debit card $14.95 a month for eternity. This ads up to $179.40 a year.
That doesn't exactly sound like it's free, does it? You can cancel within the first seven days, but given their immense advertising budget, it appears not very many people do or seem to have a problem cancelling the service. Even worse, a lot of people who signed up for their service probably aren't even aware that they could have actually gotten their credit report for free elsewhere.
Under federal law, anyone is entitled to get their credit report for free. To bring attention to this, the FTC (Federal Trade Commission) has launched an awareness campaign entitled "FTC Releases Humorous Videos with a Serious Message About AnnualCreditReport.com."
AnnualCreditReport.com is the only source authorized to give out free credit reports under federal law. The law, which is part of the Fair Credit Reporting Act, guarantees anyone access to a free credit report from each of the big three credit reporting agencies — Experian, Equifax, and TransUnion — every twelve months.
The reason for this campaign was the large volume of complaints from consumers, who thought they were getting something for free, but were not. The FTC is warning the public not to be fooled by TV ads, e-mail offers, or ads on the Internet.
Please note that little to nothing is done to make sure these ads and or spam messages offering protection are legitimate. These ads and spam e-mails might actually come from fraudsters. Answering one of them might lead to a person having their identity stolen.
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