TransUnion settlement offers free credit monitoring
By Leslie McFadden • Bankrate.com

Unless you've avoided all forms of credit for the last 20 years, you're eligible to receive free credit monitoring from TransUnion. Thanks to a proposed class-action lawsuit settlement with the credit-reporting agency, you can sign up for six or nine months of free credit monitoring. But you had better hurry if you want to enjoy the benefits. The registration window closes on Wednesday, Sept. 24.

Nearly a decade ago, consumers brought a class-action lawsuit against Acxiom Corp. and TransUnion, alleging that the two companies violated state laws and the Fair Credit Reporting Act by selling private consumer information to marketers, credit grantors and insurers.

The Fair Credit Reporting Act allows consumer reporting agencies to disclose credit reports to third parties that have a permissible purpose, which includes the underwriting of insurance, the granting of credit and employment purposes, says Chris Micheletti, a lawyer with Zelle, Hofmann, Voelbel, Mason & Gette LLP, and plaintiff attorney in the case. "Target marketing is not a permissible purpose. So when TransUnion sold lists of consumers who had certain credit characteristics and did so for target marketing purposes, it allegedly violated the FCRA as well as state law," he says.

The preliminary settlement, announced May 29, is worth more than $75 million.

Both companies have denied any wrongdoing.

"We always believed the practices in question were lawful, but we also understand that in today's environment consumers' concerns over privacy are growing. We hope this settlement demonstrates our commitment to empowering consumers to better understand, manage and protect their credit information," says Colleen Ryan, vice president of corporate and community affairs for TransUnion.

The lawsuit did not target Experian and Equifax, the other two largest credit bureaus. "Experian and Equifax did not sell/disclose the same types of information as did TransUnion. Also, Experian entered into a consent decree with the FTC in 1993, which limited the information Experian could disclose," Micheletti explains.

Who qualifies
According to the preliminary approval order for the settlement, consumers who qualify for benefits include "all natural persons who had an open credit account or an open line of credit from a U.S.-based credit grantor at any time during the period Jan. 1, 1987 to May 28, 2008."

So, if you had a department store card from 1989 to 1991 but have since lived debt free, you'd still qualify.

Micheletti says as many as 160 million to 190 million consumers could be eligible for benefits.

Consumers have until Aug. 22 to object to the settlement and until Sept. 24 to register for benefits. A final hearing on Sept. 10 will decide whether to approve the proposed settlement. No one will receive benefits until final approval, and cash benefits won't go out until at least two years afterward, if there is any money leftover after expenses.

To receive benefits, you must register at www.ListClassAction.com or call (866) 416-3470. Those who prefer to register via mail must print out the form on Page 10 of a notice from ListClassAction.com, or write a letter including the same information, and mail the paperwork to the address indicated on the form.

Do nothing and you'll get nothing.