Some Credit Karma users may be owed money after federal officials said the company told people they were “pre-approved” for credit card offers they were ultimately denied.
On Dec. 5, the Federal Trade Commission outlined the claims process for customers it said were hurt by Credit Karma’s “practice of misrepresenting” the likelihood that they would be approved for credit.
The commission filed a complaint against the credit services provider last year, accusing Credit Karma of tricking users into applying for credit cards they did not qualify for, McClatchy News reported.
These “false claims of ‘pre-approval’ cost consumers time and subjected them to unnecessary credit checks,” Samuel Levine, director of the FTC’s Bureau of Consumer Protection, said at the time.
Credit Karma denied wrongdoing and paid $3 million to resolve the accusations, according to the commission.
“We fundamentally disagree with allegations the FTC makes in their complaint, which relate solely to statements we ceased making years ago,” an Intuit Credit Karma spokesperson told McClatchy News in a statement. “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.”
“We reached this agreement to put the matter behind us so we can maintain our focus on helping our members find the financial products that are right for them,” the spokesperson said.
Now, eligible users can apply for a refund.
Here’s who qualifies and what to know:
Letters and emails are being sent to nearly 500,000 people who officials said received “pre-approved” credit card offers from Credit Karma or were told they had “90% odds” of approval, only to be denied, the FTC said.
Users who responded to the offer between February 2018 and April 2021 can file a claim.
How do I file a claim?
Affected customers can apply for payment online or call the claims administrator at 1-866-848-0871, according to the commission.
You’ll need to have your Claim ID handy, which is included in the notice sent via mail or email.
The last day to file a claim is March 4, the FTC said.
It’s not clear how much Credit Karma users can expect to receive, and officials said the amount will depend on multiple factors, including how many claims are filed.
Information on when payments will be mailed was unavailable as of Dec. 7.