The Federal Trade Commission (FTC) announced a $104 million settlement with a lead generation business on Wednesday over charges that it misled consumers and unlawfully shared and sold consumers’ private information.
The original complaint alleged that Blue Global, LLC had consumers fill out loan applications that it then sold to other entities as “leads.” FTC officials said that CEO Christopher Kay ran dozens of websites that operated in this manner and gave no consideration to where the information ultimately ended up.
“Defendants shared loan applications with and sold them to other entities without regard to loan terms, whether the other entity was a lender, or whether the other entity secured the application data in any fashion,” the complaint said.
Selling private information
The FTC further alleged that Blue Global made several false promises to consumers who filled out loan applications. According to the complaint, consumers were told that the information in their loan application would help the company find a loan with the lowest interest rate and other favorable terms, as well as help match applicants to a lender selected from a network of 100 or more loan providers.
Additionally, Blue Global allegedly told applicants that they were “very likely” to receive a loan by completing the online application and that the information they provided would “always be safe and secure” because it was only shared with “trusted lending partners.”
However, the FTC alleged that the company provided the sensitive information to any potential buyer without the knowledge or consent of the applicant. The complaint also says that Kay and his company did nothing to investigate or take preventative actions when confronted by affected consumers.
Under the terms of the settlement, the defendants are barred from misrepresenting that they can assist consumers with getting favorable loan rates or terms. They must also ensure that personal information collected from consumers is protected and secured in the future.
The defendants must also investigate and verify the identity of businesses that they give consumer information to and obtain consent from consumers before doing so. The $104 million judgment against Blue Global will be suspended based on its inability to pay.