The Federal Trade Commission (FTC) has distributed over $2.5 million in refunds to nearly 51,000 consumers who were reportedly misled by Credit Karma’s advertising practices.
This action follows a 2022 FTC complaint against the credit services company, which claimed that Credit Karma used misleading marketing tactics to encourage consumers to apply for credit cards.
The FTC alleged that Credit Karma misrepresented consumers’ chances of credit approval, telling them they were “pre-approved” or had a “90% chance” of approval.
Many consumers who applied based on these assurances were subsequently denied, resulting in hard inquiries on their credit reports that could negatively affect their credit scores.
As part of the FTC’s settlement with Credit Karma, the company agreed to stop these practices and pay refunds to affected individuals.
Refunds are being sent via checks and PayPal to 50,994 consumers who submitted valid claims by the March 2024 deadline.
The FTC advises recipients to cash their checks within 90 days or redeem their PayPal payments within 30 days.
Those with questions about their refunds can contact JND Legal Administration, the designated administrator for this distribution, by phone or through the FTC’s website.
This latest action is part of the FTC’s broader initiative to hold companies accountable for deceptive practices, having returned $330 million to consumers across various cases in 2023.