California company to pay $1.5 million for illegally obtaining financial data from millions of consumers
A Santa Monica company that allegedly tricked millions of consumers into providing sensitive information under the guise of connecting them with lenders will pay $1.5 million in civil penalties imposed by the Federal Trade Commission.
ITMedia Solutions LLC, which specializes in lead generation, will also face restrictions on its sale and use of consumer data following an FTC lawsuit filed last week.
Michael Ambrose, Daniel Negari, Jason Ramin, Grant Carpenter, Anisha Hancock and Sione Kaufusi are executives of ITMedia and affiliates in Nevada and Utah listed as defendants in the lawsuit.
ITMedia representatives did not respond to phone calls and emails seeking comment.
As of December 2012, ITMedia operates at least 200 websites on which it posts advertisements targeting consumers seeking online payday loans, consumers with low credit, and consumers seeking personal and installment loans of up to $35. $000, according to the lawsuit.
Websites used by ITMedia and its affiliates to target consumers include cashadvance.com, personalloans.com, badcreditloans.com and others with similar names. The websites say they find loans for consumers who fill out an online form providing social security and bank account numbers that the company has described as a loan application or application.
To persuade consumers to complete applications, ITMedia’s websites promise to only share sensitive information with its network of trusted lending partners and financial providers for lending purposes.
In reality, however, ITMedia and the other defendants sold consumer information to marketing companies and others without regard to how the information would be used, according to the lawsuit.
“ITMedia tricked millions into disclosing sensitive financial information and then sold it to companies that didn’t provide loans,” Samuel Levine, director of the FTC’s Consumer Protection Bureau, said in a statement. communicated. “The company’s mining and misuse of this data violated the law in several ways.”
Since January 2016, approximately 84% of loan applications collected through ITMedia’s websites were not sold to lenders, but rather distributed to marketing, debt relief and credit repair companies who would resell consumer information, according to the lawsuit.
“In many cases, ITMedia was not even aware of why a company was buying consumer data, or sometimes even the physical location of the company,” the FTC said.
ITMedia sold consumer information to a group of companies who were sued by the FTC last year for marketing payday loan products that overcharged consumers by tens of millions of dollars.
The complaint also alleges that ITMedia violated the Fair Credit Reporting Act by illegally obtaining and reselling consumers’ credit scores, exposing them to the risk of identity theft and other fraudulent activities.
The defendants agreed to pay the $1.5 million civil penalty to settle the charges brought against them by the FTC.
A proposed settlement order prohibits defendants from making misleading statements to consumers about how personal information will be used.
They are also prohibited from selling consumers’ personal information outside of a limited set of circumstances and are required to screen recipients of that information.