A proposed class action lawsuit has been filed against the identity theft protection company for allegedly defrauding customers by offering services it cannot legally perform. The lawsuit was filed in the US District Court for the District of Arizona and claims LifeLock mislead consumers with false promises.
LifeLock uses aggressive advertising to entice consumers to sign up for its $10 a month service which it describes as "proactive identity theft protection, offering a proven solution that prevents your identity from being stolen before it happens." Its advertisements prominently feature a supposed $1 million guarantee.
The lawsuit claims the fine print notes that LifeLock will not pay any losses directly to the consumer and does not cover consequential or incidental damages to identity theft. It also alleges the guarantee is limited to fixing failures or defects in the LifeLock services and paying other professionals to attempt to restore losses. LifeLock illegally places and renews fraud alerts under consumers' names with credit bureaus. However, under the federal Fair Credit Reporting Act, corporations such as LifeLock are not allowed to place fraud alerts on a consumers' behalf, in fact, the law was written to specifically bar credit repair companies from improperly using fraud alerts.