Are you owed money from the $3 million Credit Karma settlement?

(NEXSTAR) – Roughly half-a-million people may be eligible for settlement payments tied to credit card offers from Credit Karma, the Federal Trade Commission (FTC) said in a news release this week.

The payments are tied to a 2022 investigation the FTC launched after getting reports that Credit Karma, which is owned by Intuit, was falsely claiming customers were “pre-approved” or had “90% odds” of being approved for credit card offers. Thousands of applicants were rejected, costing them time and also damage to their credit scores after hard inquiries to their credit reports, the FTC said.

Credit Karma told Nexstar in a statement that it “fundamentally disagree[s]” with the allegations the FTC made in its complaint, “which relate solely to statements we ceased making years ago.”

The statement went on to say that “any implication that Credit Karma rejected consumers applying for credit cards is simply incorrect, as Credit Karma is not a lender and does not make lending decisions.”

How do I know if I’ll receive any money?

On Tuesday, the FTC said it is sending notices to 497,425 people who may be in line for a payment.

If you believe you are eligible, make sure to check your email for the notice. There are also roughly 4,000 people who will get a letter in the mail since they do not have an email address on file, according to the FTC.

If you do receive a notice, you can file your claim online at www.ftc.gov/CreditKarma, but you’ll have to apply before the March 4, 2024 deadline.

If you think you should be eligible but haven’t seen a notice from the FTC, you can email info@CreditKarmaSettlement.com or call (866) 848-0871.

The FTC says that the $3 million will go to reimbursing Credit Karma users, but the final payment amount will be calculated based on the total number of eligible applicants.

‘Dark patterns’ used, FTC says

In its September 2022 complaint the FTC accused Credit Karma of violating the Federal Trade Commission Act by employing “digital dark patterns” to trick customers.

The FTC defines such dark patterns as actions “that can trick or manipulate consumers into buying products or services or giving up their privacy.”

Examples include making ads look like independent content, burying crucial information or fees in fine print or making it hard to cancel a subscription fee.

The FTC claimed that Credit Karma knew, based on experimental A/B testing, that consumers are far likelier to click on an offer that said “pre-approval” than one advertising “excellent odds” of approval.

“When user interfaces are designed, including with the aid of A/B testing, to trick consumers into taking actions in a company’s interest and that lead to consumer harm, such design tricks have been described as ‘dark patterns,'” the FTC said.

Credit Karma allegedly used the dark pattern advertising from February 2018 to April 2021.

The credit monitoring company continued in its statement to Nexstar Thursday:

Credit Karma helps our more than 130 million members understand their finances, including their likelihood of approval for financial products. We have a track record of positive outcomes, and members shopping for credit cards on Credit Karma have a significantly higher approval rate than the national average. We reached this agreement to put the matter behind us so we can maintain our focus on helping our members find the financial products that are right for them.”