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Identity Theft Service Provider Agrees To Issue Refunds And Pay Costs Of Investigating Deceptive Advertising

CONTACT: Sarah London, Assistant Attorney General, (802) 828-5479

March 9, 2010

Today Attorney General William H. Sorrell together with the Federal Trade Commission (FTC) and 34 states announced a settlement with LifeLock, Inc., a Tempe, Arizona-based identity theft service provider, that resolves an investigation into the company’s misleading advertisements. Eligible Vermont consumers will receive refunds and the state will receive $15,000 to cover the costs of investigation.

“LifeLock led consumers to believe the impossible – that it could fully protect against identity theft,” said Attorney General Sorrell. “Now, many consumers will get their money back and everyone will have a better sense of what LifeLock actually provides.” The FTC and states will jointly send letters to eligible consumers, notifying them of the agreement and how they can benefit from the settlement. Although the FTC and state attorneys general share authority over unfair and deceptive advertising, a joint enforcement action of this magnitude is unprecedented.

LifeLock sells services which past advertisements claimed were “guaranteed” to protect consumers’ personal information. Some ads even included CEO Todd Davis’s Social Security Number, which Davis said, showed “how confident I am in LifeLock’s proactive identity theft protection.” The FTC and states jointly investigated allegations that the company misled consumers into believing that its services were a “proven solution” to protect against all forms of identity theft.

Under the agreement, LifeLock may not misrepresent that its services can eliminate the risk of identity theft or protect against all types of identity theft. Additionally, LifeLock may not misrepresent that it constantly monitors each of its customers’ consumer reports. The company also may not overstate the risk of identity theft, including whether a particular consumer has become or is likely to become a victim. Past marketing materials warned individual consumers about their heightened risk of identity theft when LifeLock did not have information to warrant such a warning.

Vermont and federal laws provide a variety of tools to help protect against identity theft. Consumers who suspect that they are or are about to become victims of identity theft can place free fraud alerts on their credit reports by contacting one of the three major credit reporting agencies. In addition, consumers can obtain free copies of their credit reports to review their credit histories and identify errors and inaccuracies, such as unauthorized accounts.

For more information about how to protect against identity theft, follow the “Identity Theft” link on the Vermont Consumer Assistance Program’s website at: http://www.uvm.edu/consumer/.

  Website consulting provided by The National Association of Attorneys General.