Consumers who were deceived by pre-approved credit card offers from Credit Karma have until the March 4 deadline to sign up to get their part of a $3 million settlement with federal regulators.
The Federal Trade Commission (FTC) alleged that Credit Karma tricked consumers into believing they were “pre-approved” for a credit card or had “90% odds” of approval, but in many cases, the consumers didn’t qualify.
“Consumers who applied incurred a hard inquiry on their credit reports, and, if they were denied, may have damaged their credit scores unnecessarily,” the FTC alleged.
The FTC notified nearly 500,000 consumers they may have been eligible for a payment late last year. Most of the 497,425 affected consumers should have received a notification email, but about 4,000 people who did not have an email address on file were supposed to get a notice in the mail, it said.
Go to ftc.gov/CreditKarma to file your claim, and you can ask questions can by emailing info@CreditKarmaSettlement.com or by calling (866) 848-0871, the FTC said.
“Your payment amount will depend on several factors, including how many people file claims,” the FTC said, adding that a mailing date for the payment has not yet been set.
Credit Karma said it agreed to the settlement to put the allegations behind it but it disagreed with the FTC’s accusations.
“Any implication that Credit Karma rejected consumers applying for credit cards is simply incorrect, as Credit Karma is not a lender and does not make lending decisions,” the company said at the time. “Rather, Credit Karma helps our more than 130 million members understand their finances, including their likelihood of approval for financial products.”
“We have a track record of positive outcomes, and members shopping for credit cards on Credit Karma have a significantly higher approval rate than the national average,” the company said.
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Karin Price Mueller may be reached at KPriceMueller@NJAdvanceMedia.com. Follow her on X at @KPMueller.
