April 12 (UPI) -- The Consumer Financial Protection Bureau announced Tuesday a lawsuit against TransUnion and a former top executive for disregarding a 2017 law enforcement order in place to prevent deceptive practices.
The government agency says TransUnion, a Chicago-based American consumer credit reporting company, continued unlawful behavior after the order went into effect.
The Bureau claims TransUnion violated consumer financial protection laws and profited from its customers through "deceitful" digital dark patterns.
Dark patterns are digital interfaces designed to subtly trick people out of money or into sharing personal data.
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TransUnion collects information on 200 million Americans and reported $3 billion in revenue in 2021.
Over 150,000 consumers made complaints to the Bureau regarding TransUnion's practices last year.
"TransUnion is an out-of-control repeat offender that believes it is above the law," said Bureau director Rohit Chopra. "I am concerned that TransUnion's leadership is either unwilling or incapable of operating its businesses lawfully."
In the lawsuit, the company is accused of deceptively marketing credit scores to consumers. Part of the deception allegedly included marketing credit-related products as free or as $1.
However, upon signing up, a person would be automatically subscribed to a program with a monthly recurring charge until they cancel.
Dark patterns can complicate the canceling of such services for consumers.
Former top executive John Danaher, who had served as a top executive of TransUnion Interactive since 2004, is also named in the lawsuit.
TransUnion Interactive sold products and services directly to consumers, making up about 18% of TransUnion's overall revenue.
Filings with the Securities and Exchange Commission show that Danaher had received over $10 million since 2016 from the sale of TransUnion stock shares he acquired as part of his compensation package.
Though he was also meant to follow the order, the suit claims he "repeatedly failed to ensure that TransUnion took certain required steps and refrained from prohibited conduct."
Danaher, who recently separated from TransUnion, is accused of devising a plan to hold off on having to implement the order that would have reduced the company's revenue.
