LifeLock agrees to pay $100 million for allegedly violating FTC order
Have you ever wondered what happens when a company is charged with violating a settlement order with the FTC? Well, ya got trouble. I mean trouble with a capital “T”. And for LifeLock, that trouble comes partly in the form of full refunds of up to $100 million for consumers affected by its alleged order violations.
Let me set the stage. In 2010, LifeLock agreed to settle charges with the FTC and 35 state attorneys general that it used false claims to promote its identity theft protection services. The settlement required Lifelock to:
- stop making deceptive claims;
- strengthen measures to safeguard the personal information it collects from customers; and
- pay the FTC $11 million for consumer refunds.
It’s five years later and what do we have? Broken promises and injured consumers. According to the FTC, LifeLock violated the 2010 FTC settlement order by:
- from at least October 2012 through March 2014, failing to establish and maintain a comprehensive information security program to protect its customers’ sensitive personal information, including credit card, Social Security, and bank account numbers;
- during that period falsely advertising that it protected consumers’ sensitive data with the same high-level safeguards as financial institutions;
- falsely advertising that it would send alerts “as soon as” it received any indication that a consumer may be a victim of identity theft from January 2012 through December 2014; and
- failing to meet the 2010 order’s recordkeeping requirements.
If you’re concerned about protecting your personal information, you may consider paying for identity theft protection services. But before you pay any fees, evaluate the company and its track record. Type the name of the company or product into a search engine along with words like “review,” “complaint,” or “scam.” Be sure to read a few reviews — don’t rely on just one source. Or, you may decide to take matters into your own hands by reviewing your credit reports on a regular basis or placing a credit freeze on your report.