FTC Takes Action Against Deceptive Junk Fees
May 31, 2024
The Case
The FTC recently took action against a bill payment company and its co-founders, accusing them of deceptive “junk fee” practices that harmed consumers. The FTC’s complaint alleges that the firm used misleading search ads and deceptive designs to conceal millions of dollars in “junk fees.”
The complaint also outlines the firm's “deceptive” process for signing up consumers for its recurring subscription program. It notes that, until February 2024, after learning of the FTC’s proposed complaint, the company automatically checked the box to sign up consumers when they clicked to read a “terms of service” document.
Why Does This Matter?
The action shows the agency’s focus on holding companies accountable for imposing “junk fees” on consumers. It aligns with the FTC’s recently proposed rule to ban junk fees.
InnReg's Experience
For over 10 years, InnReg has assisted fintechs in reviewing their fee structures and related disclosures and adhering to strict reporting and recordkeeping requirements to ensure they do not create regulatory risk.
Learn More About This Topic
For additional details, read how InnReg’s Fintech Compliance checklist can help your fintech build best practices to meet evolving regulatory requirements.
The Securities and Exchange Commission (SEC) recently penalized a broker-dealer for failing to file Suspicious Activity Reports (SARs) as required under the Bank Secrecy Act.
FINRA recently fined two broker-dealers for failing to adequately supervise and monitor trading activities to detect and prevent potentially manipulative practices.
FINRA has issued an update detailing its ongoing efforts to monitor and regulate crypto asset-related activities among its member firms.
