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FTC cracks down on grey charger ScoreSense – but is this enough?

A grey charge giant has been reeled in. Or has it?

Since day one at BillGuard, users have continually reported ScoreSense for unfair billing practices. The company, under more than 50 brand and domain names, runs a classic free-to-paid scheme, offering consumers free credit scores that then become high monthly fees for credit monitoring.

Our study found that sneaky free-to-paid schemes like ScoreSense’s add up to over $6 billion in grey charges annually for Americans.

The Federal Trade Commission, working together with the Attorneys General of Ohio and Illinois, filed a lawsuit against ScoreSense parent company One Technologies after least 210,000 consumers contacted banks, credit card companies, law enforcement agencies, the Better Business Bureau – in addition to BillGuard – to complain about the scheme.

As you can see from its BillGuard resolution page, ScoreSense does cooperate to help resolve billing complaints, but that was apparently not enough. Last week, the FTC action forced One Technologies to set up a $22 million fund to repay consumers who were wrongfully charged for its services.

One Technologies’ press release on the settlement tries to spin it as positive. Entitled ‘One Technologies Sets New Standard for Industry Transparency and Disclosure’, the company proclaims (emphasis added):

One Technologies… today announced that it has signed agreements with the Federal Trade Commission (FTC) and three State Attorneys General to resolve a compliance inquiry and set a new standard for the industry’s clearest and simplest subscription disclosures. One Technologies has already implemented the new disclosures.

Take a look at those new disclosures, on the ScoreSense landing page:

scoresense lp

And billing page:

scoresense billing page

Do you think this is clear enough disclosure of what the consumer commits to at the time of this agreement? Do you think the average person who wants access to their credit score is aware of the membership fee they accept at this time?

And one more question. In its press release on the settlement, One Technologies announces that it “has more than quadrupled in size in the past five years, and the settlement will not affect One Technologies’s operations or plans for future growth.” So how much damage does $22 million do to One Technologies?

~ Safer together @BillGuard.