On August 17, the FTC announced a proposed $2.1 million settlement, subject to court approval, with an online bill payment firm and two of its co-founders resolving allegations that the company used misleading search advertisements to impersonate consumers’ billers and charged fees that were not clearly disclosed. As previously covered by InfoBytes, a federal court granted summary judgment to the FTC as to the company’s liability on two claims under the Restore Online Shoppers’ Confidence Act (ROSCA). The FTC alleged in a 2024 complaint that the firm used search advertisements and landing pages featuring other companies’ names and logos to trick consumers into using its third-party payment platform for utility, car loan, and other bills, despite not having a direct relationship with most billers. The FTC further alleged that the firm charged insufficiently disclosed “delivery fees” and deceptively enrolled consumers in a recurring subscription program without clearly disclosing material terms or obtaining express informed consent, in violation of the FTC Act, the GLBA, and ROSCA.

Under the proposed stipulated order, the firm and its co-founders neither admit nor deny the complaint’s allegations. The order would require the firm to pay $2.1 million in monetary relief, which the FTC states would be used for consumer redress. The order would permanently prohibit the firm and its co-founders from: (i) misrepresenting their affiliation with billers, including by using a biller’s website address or branded name or logo in a manner that misrepresents such an affiliation; (ii) misrepresenting the amount consumers will pay or the nature or purpose of any fee; (iii) using false representations to obtain consumers’ financial information; and (iv) making misrepresentations regarding negative option features. The order would also require clear and conspicuous disclosure of all material subscription terms before obtaining billing information, express informed consent before charging consumers, and a simple cancellation mechanism that is “at least as easy to use” as the mechanism used to consent.