LifeLock Lawsuit Over - Settles Deceptive Advertising Claims with Feds for $12million - 6,074 Views, 4 Comments
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of a million people who read it LifeLock, the company that offers identity theft insurance, has settled a lawsuit with the FTC after the Federal Trade Commission sued LifeLock for deceptive advertising claims. LifeLock says that they were happy to settle the suit because the suit was based on facts that are two years old, and no longer applicable. Of the state of things two years ago, however, FTC Chairman Jon Leibowitz says that “While LifeLock promised consumers complete protection against all types of identity theft, in truth, the protection it actually provided left enough holes that you could drive a truck through it.” That may or may not have been a sarcastic reference to the truck that LifeLock itself used in its marketing campaigns, which had LifeLock CEO Todd Davis’ social security number emblazoned on the side, for all to see (and, in theory, try to steal). In a statement, Davis said that “Nothing changes as a result of this settlement because it was based on activities from over two years ago. We agreed to settle this matter in order to quickly put this behind us so we can get back to doing what we do best - helping to protect our members from identity theft.” In fact, adds Davis, he feels that the settlement will help to “set advertising standards for the entire identity theft protection industry.” The FTC’s complaint against LifeLock included allegations that LifeLock had made promises to consumers that it couldn’t fulfill, including promises about protections against identity theft, that it was the first company to offer identity theft protection, and that it protected against unauthorized changes to a customer’s address information. The FTC also alleged that Lifelock offered no protection against the abuse of accounts which already exist (as compared to the unauthorized creation of a new account in a consumer’s name), and alleged that LifeLock was being deceptive in claiming that it offered constant monitoring of their customers’ credit reports, and that customers would always be alerted before a new account was opened in a customer’s name. According to Illinois Attorney General Lisa Madigan, one of 35 states’ attorneys general to be part of the plaintiff pool, “This agreement effectively prevents LifeLock from misrepresenting that its services offer absolute prevention against identity theft because there is unfortunately no foolproof way to avoid ID theft. Consumers can take definitive steps to minimize the chances of having their personal information stolen and this settlement will help them make more informed decisions about whether to enroll in ID theft protection services.” As we said in our original article on LifeLock, we have no direct experience with them, so we can’t say “use them”, but we also can’t say “don’t use them.” Anybody out there able to speak from experience?
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I subscribed to LifeLocks’ services months after they opened for business in 2005 after my personal affects, including Passport, Birth Certificate and other confidential information was stolen in a burglary. I worked closely with them to provide the Police Report and all other pertinent information. Within a couple of months people were applying for credit–my credit, which I’ve earned. As recently as 2010, a man in Brooklyn tried to withdraw money from my Bank Account using a driver’s license with my information and his picture. LifeLock has been there for me for each incident. LifeLock agents are proactive and take immediate action while I’m busy at work. I consider the $10 monthly fee to be credit insurance and I’m grateful for their services.
Comment by Aaron Freeman — 3/12/2010 @ 9:06 am
Over the years, the crime of identity theft has done nothing but increase. Right along with it, LifeLock has introduced new and innovative ways to reduce the kinds of damage that can be done to consumers’ credit and financial solvency by the crime of identity theft. They were at the forefront of the ID theft consumer education movement before anyone else had given it much thought. And now that everyone knows what terrible havoc can be done by identity theft, LifeLock continues to lead the way, utilizing advancements in technology to keep up with the newest ways identity thieves have found to operate.
I have been a spokesperson for LifeLock for three years now, and my relationship was built on the integrity of the people behind the company. LifeLock was there for me after learning I was the victim of identity theft, just like they have been for all of their customers.
I am proud of Lifelock’s proven commitment to consumer education and the law enforcement communities. I know that they will continue doing what they already do extremely well: help people avoid the pain of a stolen identity.
I would love to talk more with you about identity theft -which is what I spend a great deal of my time doing. As a longtime advocate I spend much of my time warning consumers of scams -but LifeLock is NOT one of them. I would also be happy to share how LifeLock helped me resolve my identity theft and how they’ve built partnerships with the National Crime Prevention council and other great organizations devoted to helping victims. I also would be happy to refer you to various consumers and activists who feel the FTC could have done a better job on this one! We want the FTC to stand up for us, make sure consumers are protected from deceptive practices, but this time they missed their mark—by a football field.
Comment by Denise Richardson — 3/12/2010 @ 10:11 am
when will I get my money?
Comment by Al Cruz — 4/29/2010 @ 1:13 pm
My main beef with Lifelock is with their advertising…ads which I have heard as recently as the past month. Specifically, they give an example of someone who had their credit cards stolen from their car…and lamenting that they should have signed up for Lifelock. Credit card theft is NOT identify theft. Lifelock even admits this on their own web site. I wish they would stop advertising using samples that are completely unrelated to the product they actually sell. That would be like Allstate having an ad about someone who crashed their mountain bike and should have purchased automobile insurance. It’s simply misleading and there are too many gullible people out there.
Just my 2 cents.
Steve
Comment by Steve Arnold — 4/30/2010 @ 12:10 pm