CFPB Issues Guidance To Protect Consumers Locked Into Unwanted Subscriptions

Are you or someone you locked into a subscription service that you do not want? If so, please Click Here, call us at (844) 431-0695, or email us cis@fbfglaw.com to discuss your legal options.

Have you ever signed up for a free trial of a product or service, only to find out later that you were charged a recurring fee for something you did not want? If so, you are not alone. According to the Consumer Financial Protection Bureau (CFPB), many consumers have fallen victim to deceptive marketing tactics that trick them into agreeing to subscriptions they do not need or want.

The CFPB has issued guidance to financial institutions and payment processors to help them identify and stop these practices, which are also known as negative option billing marketing. These practices involve obtaining a consumer’s payment information for one purpose, such as a free trial, and then using it to charge the consumer for another product or service without their informed consent. Companies who engage in these practices risk violating the Consumer Financial Protection Act’s (CFPA) prohibition on unfair, deceptive, or abusive acts.

The CFPB’s guidance outlines the warning signs of these tactics, such as:

• Charging consumers for products or services that are different from what they signed up for or expected
• Charging consumers more than what they agreed to pay or for longer than they expected
• Hiding important terms and conditions in fine print or obscure links
• Making it difficult or impossible for consumers to cancel their subscriptions or get refunds
• Failing to provide clear and accurate information about the subscriptions and how to cancel them

The CFPB also advises financial institutions and payment processors to take appropriate actions to protect consumers from these practices, such as:

• Monitoring transactions and complaints for signs of deceptive marketing
• Verifying that consumers have given their consent before processing recurring charges
• Providing clear and timely notices to consumers about their subscriptions and how to cancel them
• Honoring consumers’ requests to cancel their subscriptions and stop the charges
• Refunding consumers who have been charged without their consent

Attorneys at Finkelstein, Blankinship, Frei-Pearson & Garber, LLP have successfully recovered millions of dollars on behalf of consumers aggrieved by such deceptive practices.  We are currently investigating this matter. If you or someone you or someone you know has purchased a subscription service that is impossible to cancel, please contact us to discuss your legal options.