Experian offered consumers free credit reports

UK-owned Experian lured people into signing up to the service by offering them free credit reports, the US Federal Trade Commission (FTC) said.

Consumers were not adequately informed that they would be tied into the credit monitoring service, the FTC said.

They faced a $79.95 charge if they did not cancel the service within 30 days.

'Unfair and deceptive'

The FTC said Experian had agreed to refund consumers and would return some $950,000 (�528,318) in gains.

It said the company had used TV, radio, e-mail and internet advertisements promising free credit reports and extra free trials of a credit monitoring service.

Under the settlement, Experian was barred from making misleading claims about "free" offers and ordered to better explain the terms of its offers.

"It's unfair and deceptive to promise consumers something for free and then trick them into paying for products they didn't want in the first place," said Lydia Parnes, director of the FTC's Bureau of Consumer Protection.

In a press release, Experian said that it has fully cooperated with the FTC to resolve the problem since the FTC first raised its concerns in 2002.

The company says "it stands by its products and is proud of the valuable benefits credit monitoring provides to millions of satisfied customers."