LifeLock to Pay $100 Million to Settle U.S. Deception Claimsby
Settlement resolves claims it violated 2010 pact with FTC
Accused of deceptive advertising, failing to protect data
LifeLock Inc. agreed to pay $100 million to settle U.S. accusations that it made deceptive claims about its identity-theft protection services and failed to take steps to protect user data, the Federal Trade Commission said.
LifeLock, which offers to monitor for fraud and restore stolen identities with services starting at $9.99 a month, was accused in July of violating a 2010 settlement with the FTC and 35 state attorneys general that prohibited deceptive advertising and required the company to secure consumers’ personal information.
“The fact that consumers paid Lifelock for help in protecting their sensitive personal information makes the charges in this case particularly troubling,” FTC Chairwoman Edith Ramirez said.
The settlement payment, which the FTC said is the largest monetary award obtained in an order enforcement action, will go toward consumer redress. LifeLock, based in Tempe, Arizona, paid $12 million in the 2010 settlement.
"There is no evidence that LifeLock has ever had any of its customers’ data stolen, and the FTC did not allege otherwise," LifeLock said.
The settlement resolves litigation brought by the FTC and consumers, according to LifeLock. The company said allegations raised by the FTC are related to advertisements it no longer runs.
LifeLock shares spiked 3 percent on the news before falling 3 percent and were trading down 2 percent to $13.96 at 12:56 p.m. in New York.
The case is FTC v. LifeLock Inc., 10-00530, U.S. District Court, District of Arizona (Phoenix).