Tuesday, March 9, 2010

LifeLock Pays $12M Over False Advertising Claims

Tempe, Arizona-based LifeLock, which provides identity theft protection services, has agreed to pay $12M over false advertising claims, according to the Federal Trade Commission. According to the FTC, LifeLock will pay $11M to the FTC, and $1M to a group of 35 state attorneys general, to settle charges that the firm sued false claims to promote its identity theft protection services. FTC said that LifeLock and its principals will be barred from making deceptive claims and required to take more stringent measures to safeguard the personal information they collect from customers. The FTC said the settlement is one of the largest, FTC-state coordinated settlements on record. The FTC also said that LifeLock's services "left enough holes that you could drive a truck through it." As part of the settlement, the FTC said it would use the $11M from the settlement to provide refunds to consumers. In a statement, LifeLock said it would "welcome federal and state efforts to regulate our industry, because doing so helps to protect consumers from the risks of identity theft." The firm also said that the settlement cover its "old practices and products" and not its current services.