On September 15, the FTC released a report, Bringing Dark Patterns to Light, that shows an increase in the use of sophisticated “dark pattern” design practices by retailers intended to manipulate consumers into making decisions that benefit the retailers at the consumers’ expense. The report examined the use of dark patterns across a variety of industries and contexts, including e-commerce, cookie consent banners, children’s applications, and subscription sales. The report highlighted four common tactics:

Continue Reading FTC Reports Rise in “Dark Pattern” Tactics in Consumer Markets

On September 1, the FTC issued an administrative complaint and consent order alleging that a credit services company harmed consumers by making false claims of “pre-approved” credit offers, enticing many consumers to apply for offers they ultimately did not qualify for and unnecessary credit checks.

Continue Reading FTC Targets Credit Services Company For False “Pre-Approved” Credit Offers

The FTC recently published an advance notice of proposed rulemaking to discuss harms associated with the collection, processing, and selling of personal data. The FTC is inviting public comments on whether it should implement new rules on how companies:

Continue Reading FTC Signals Focus on Increasing Protections Around Personal Data

On August 9, the US District Court of Georgia ruled that the FTC had provided “broad and detailed evidence” for its allegations that a tech company and its CEO engaged in deceptive advertising and unfair fee practices in violation of Section 5 of the FTC Act. The FTC’s 2019 complaint alleged the defendants made deceptive representations to customers and charged hidden, unauthorized fees in connection with the company’s “fuel card” products, including by:

Continue Reading Court Orders Injunctive Relief Against Tech Company for Deceptive Advertising, Unfair Fee Practices

On July 29, a payment processor company and its two sales affiliates (defendants) agreed to a stipulated order with the FTC to settle charges that they imposed hidden terms, surprise exit fees, and “zombie charges” on small businesses.

Continue Reading Payment Processor Agrees to Refund Customers After FTC Alleges Surprise Exit Fees and Zombie Charges On Small Businesses

On June 23, the FTC proposed a rule that would prohibit junk fees, bait-and-switch advertising, and other deceptive practices by auto dealers to protect consumers and honest dealers in the car-buying process. The proposed measures would:

Continue Reading FTC Targets Junk Fees, Bait-and-Switch Advertising by Auto Dealers

On June 2, the FTC was granted a federal court order permanently barring a merchant cash advance operation and its owner from engaging in further deceptive practices and granting restitution to the customers the company harmed. The defendants offered alternative small business financing by purportedly providing funds to businesses in exchange for a percentage of future revenue. According to the FTC, however, the defendants frequently deceived small businesses and their owners, lying about terms and fees for their financing. The websites falsely claimed that cash advanced required no personal guaranties of collateral while the contracts did include such requirements. The merchant cash advance company also required businesses and owners to sign confessions of judgment, which allowed the company to obtain uncontested judgments in cases of alleged default, and which the defendants sometimes used to illegally and improperly seize consumers’ assets. Customer businesses often received thousands of dollars less funding than promised. The FTC further alleged that the defendant company and owner threatened physical violence when the businesses were unable to pay. Finally, the company is accused of providing false documents to the court during proceedings.

Continue Reading FTC Captures $2.7 Million in Restitution from Small Business Financer

On April 29, the CFPB filed a proposed order in federal court seeking final judgment against three California-based defendants for engaging in unlawful fee-charging practices and deceptive telemarketing. According to the complaint, the defendants, a student loan debt relief business and a general debt-settlement company, along with their owner and CEO charged illegal upfront fees and deceived customers into paying for debt relief services in violation of the Consumer Financial Protection Act (CFPA) and Telemarking Sales Rule (TSR).  The CFPB alleges that defendants wrongfully charged more than 9,000 consumers with federal student-loan debt a total of approximately $10.5 million in illegal upfront fees, and used deceptive sales tactics to lure consumers into signing up for certain debt-relief services.  If approved by the court, defendants would be banned from performing debt relief and settlement activities.  The CEO would also be require to pay a civil monetary penalty of $30,000.
Continue Reading No Relief in Sight: CFPB and FTC Continue to Take Action Against Debt Settlement Companies

On April 28, the FTC proposed updating the Telemarketing Sales Rule (TSR) to extend protections against telemarketing tricks and traps to small businesses and to strengthen defenses against other telemarketing schemes that negatively impact consumers. The agency is seeking public comments on the proposed changes to the rule.

Continue Reading FTC Proposes Updates to Telemarketing Sales Rule, Business to Business Exemption in Order To Protect Small Businesses