Credit Karma settlement update: Deadline near for part of $4 million settlement
The filing deadline for a settlement involving credit servicing company Credit Karma is approaching.
Last year, the Federal Trade Commission announced it had reached an agreement with Credit Karma over so-called “pre-approved” credit card offers. According to the complaint, the company used claims consumers were “pre-approved” or had “90% odds” of approval to entice them to apply for offers that, ultimately, they did not qualify for. The consent order required Credit Karma to pay $3 million.
At the time of the settlement, Credit Karma said it disagreed with the FTC allegations.
“Any implication that Credit Karma rejected consumers applying for credit cards is simply incorrect, as Credit Karma is not a lender and does not make lending decisions,” the spokesperson said at the time, according to a report in NJ.com. “Rather, Credit Karma helps our more than 130 million members understand their finances, including their likelihood of approval for financial products.
“We have a track record of positive outcomes, and members shopping for credit cards on Credit Karma have a significantly higher approval rate than the national average,” the spokesperson said.
According to the FTC, almost 500,000 people were possibly eligible for a payment if they were denied credit after responding to one of the offers sometime between February 2019 and April 2021. Affected customers were notified by email and letters and can apply for payment online at secure.creditkarmasettlement.com. You can also call the claims administrator at 1-866-848-0871.
The deadline for filing a claim is March 4. The amount of payments will depend on several factors, including how many people file claims.