The Federal Trade Commission says it paid more than $2.5 million to Credit Karma customers who were deceived into applying for credit cards, damaging their credit cards. said thursday.

The funds going to approximately 51,000 customers are a result of the FTC’s regulatory action against Credit Karma in 2022.

The FTC claimed that Credit Karma, which offers free credit scores and monitoring in exchange for personal data, damaged the credit of tens of thousands of people by misleading customers into thinking they would be approved and apply for credit cards.

For example, the FTC said Credit Karma used language like “pre-approved” and “90% rate” to trick people into applying for offers that the company knew they didn’t actually qualify for.

“Credit Karma’s false claims about ‘pre-approval’ cost consumers time and subjected them to unnecessary credit checks,” said Samuel Levine, director of the FTC’s Bureau of Consumer Protection.

Credit Karma agreed to pay millions to resolve the dispute with the FTC and to stop making such claims.

The FTC said the company collected more than 2,500 data points about each customer, including their personal finances, and used that information to deliver targeted ads for financial products like credit cards.

Credit Karma is owned by Intuit, which also owns Turbotax and Quickbooks.