Vonage to pay $100m for making it nearly impossible to cancel internet phone services
(2022/11/04)
- Reference: 1667592544
- News link: https://www.theregister.co.uk/2022/11/04/vonage_ftc_order/
- Source link:
Vonage has agreed to cough up $100 million to customers for making it nearly impossible to cancel their internet phone service, according to a proposed court order.
The [1]Ericsson subsidiary , which provides Voice over Internet Protocol (VoIP) to folks and small businesses, automatically bills customers for these services every month, according to a US Federal Trade Commission complaint. These bills range from $5 to $50 for consumers, and businesses pay upwards of thousands of dollars each month.
While the telecoms giant makes it really easy to sign up for their phone services — consumers can enroll online, on their own, without any agent assistance — Vonage, since at least 2015, "failed to provide a simple method for customers to cancel their telephone services," the American consumer watchdog agency claimed
[3]
The VoIP biz used "a panoply of hurdles, sometimes referred to as dark patterns, to keep customers on the hook and prevent them from stopping the monthly charges, the FTC alleged.
[4]
[5]
For example, Vongage requires customers that want to cancel their phone bill to speak to a live "retention" agent during limited hours and "obscured contact information" to reach an operator, the FTC said. While on the phone with a Vonage agent, customers "faced redundant procedural requirements, long wait times, dropped or unanswered calls, lengthy and repeated sales pitches, and unexpected high-dollar early termination fees," according to the complaint.
Even if customers do manage to jump over all of these hurdles and cancel their accounts, "in many instances, Vonage has continued to charge them without consent," it said.
[6]
Vonage, for its part, has agreed to settle the court order
These include providing a simple cancellation process that is easy to find and use, and being upfront about subscription plans and "negative options" — this happens when a customer agrees upfront to certain services, the provider then starts adding new ones, and treats the consumer's failure to reject the services or cancel the agreement as consent to be charged.
Vonage must also have express, informed consent before it can charge customers and must stop using dark patterns on its website.
[8]
"This record-breaking settlement should remind companies that they must make cancellation easy or face serious legal consequences," Samuel Levine, director of the FTC's Bureau of Consumer Protection said in a [9]statement .
To put the $100 million settlement in perspective: Vonage's 2021 revenue [10]topped $1.4 billion .
[11]Ericsson CEO Börje Ekholm leaves Alibaba board to focus on his main job
[12]Google burns few hours of profit to disappear location privacy lawsuit
[13]Education tech giant gets an F for security after sensitive info on 40 million users stolen
[14]Google fined $42.5m over misleading Android location settings in Australia
The SEC enforcement makes Vonage the latest big tech firm to come under fire by regulators and the courts for using dark patterns.
Last month Google agreed to [15]pay $85 million to settle a privacy lawsuit that accused the internet behemoth of using "dark patterns" in its user interfaces – deceptive controls and layout of settings – to fool people into providing their real-time whereabouts to the mega-corp for targeted advertising purposes.
Additionally, the FTC recently began its rule-making process to impose [16]stricter privacy rules on corporations, and during a recent public hearing, dark patterns frequently came up as one area that's [17]ripe for regulation. ®
Get our [18]Tech Resources
[1] https://www.theregister.com/2022/03/22/ericsson_ceo_leaves_alibaba_board/
[2] https://www.ftc.gov/system/files/ftc_gov/pdf/Vonage-Complaint.pdf
[3] https://pubads.g.doubleclick.net/gampad/jump?co=1&iu=/6978/reg_onprem/personaltech&sz=300x50%7C300x100%7C300x250%7C300x251%7C300x252%7C300x600%7C300x601&tile=2&c=2Y2WZj-Uq6tsyCqGTWIWz4QAAABA&t=ct%3Dns%26unitnum%3D2%26raptor%3Dcondor%26pos%3Dtop%26test%3D0
[4] https://pubads.g.doubleclick.net/gampad/jump?co=1&iu=/6978/reg_onprem/personaltech&sz=300x50%7C300x100%7C300x250%7C300x251%7C300x252%7C300x600%7C300x601&tile=4&c=44Y2WZj-Uq6tsyCqGTWIWz4QAAABA&t=ct%3Dns%26unitnum%3D4%26raptor%3Dfalcon%26pos%3Dmid%26test%3D0
[5] https://pubads.g.doubleclick.net/gampad/jump?co=1&iu=/6978/reg_onprem/personaltech&sz=300x50%7C300x100%7C300x250%7C300x251%7C300x252%7C300x600%7C300x601&tile=3&c=33Y2WZj-Uq6tsyCqGTWIWz4QAAABA&t=ct%3Dns%26unitnum%3D3%26raptor%3Deagle%26pos%3Dmid%26test%3D0
[6] https://pubads.g.doubleclick.net/gampad/jump?co=1&iu=/6978/reg_onprem/personaltech&sz=300x50%7C300x100%7C300x250%7C300x251%7C300x252%7C300x600%7C300x601&tile=4&c=44Y2WZj-Uq6tsyCqGTWIWz4QAAABA&t=ct%3Dns%26unitnum%3D4%26raptor%3Dfalcon%26pos%3Dmid%26test%3D0
[7] https://www.ftc.gov/system/files/ftc_gov/pdf/Vonage-Stipulated-Final-Order.pdf
[8] https://pubads.g.doubleclick.net/gampad/jump?co=1&iu=/6978/reg_onprem/personaltech&sz=300x50%7C300x100%7C300x250%7C300x251%7C300x252%7C300x600%7C300x601&tile=3&c=33Y2WZj-Uq6tsyCqGTWIWz4QAAABA&t=ct%3Dns%26unitnum%3D3%26raptor%3Deagle%26pos%3Dmid%26test%3D0
[9] https://www.ftc.gov/news-events/news/press-releases/2022/11/ftc-action-against-vonage-results-100-million-customers-trapped-illegal-dark-patterns-junk-fees-when-trying-cancel-service
[10] https://www.globenewswire.com/news-release/2022/02/24/2391990/0/en/Vonage-Reports-Fourth-Quarter-2021-Financial-Results.html
[11] https://www.theregister.com/2022/03/22/ericsson_ceo_leaves_alibaba_board/
[12] https://www.theregister.com/2022/10/04/google_privacy_lawsuit_settlement/
[13] https://www.theregister.com/2022/10/31/chegg_ftc_order/
[14] https://www.theregister.com/2022/08/12/google_accc_penalty/
[15] https://www.theregister.com/2022/10/04/google_privacy_lawsuit_settlement/
[16] https://www.theregister.com/2022/09/09/data_tracking_national_security_risk/
[17] https://www.theregister.com/2022/09/09/mozilla_cso_ftc_surveillance/
[18] https://whitepapers.theregister.com/
The [1]Ericsson subsidiary , which provides Voice over Internet Protocol (VoIP) to folks and small businesses, automatically bills customers for these services every month, according to a US Federal Trade Commission complaint. These bills range from $5 to $50 for consumers, and businesses pay upwards of thousands of dollars each month.
While the telecoms giant makes it really easy to sign up for their phone services — consumers can enroll online, on their own, without any agent assistance — Vonage, since at least 2015, "failed to provide a simple method for customers to cancel their telephone services," the American consumer watchdog agency claimed
[2]PDF
.[3]
The VoIP biz used "a panoply of hurdles, sometimes referred to as dark patterns, to keep customers on the hook and prevent them from stopping the monthly charges, the FTC alleged.
[4]
[5]
For example, Vongage requires customers that want to cancel their phone bill to speak to a live "retention" agent during limited hours and "obscured contact information" to reach an operator, the FTC said. While on the phone with a Vonage agent, customers "faced redundant procedural requirements, long wait times, dropped or unanswered calls, lengthy and repeated sales pitches, and unexpected high-dollar early termination fees," according to the complaint.
Even if customers do manage to jump over all of these hurdles and cancel their accounts, "in many instances, Vonage has continued to charge them without consent," it said.
[6]
Vonage, for its part, has agreed to settle the court order
[7]PDF
that will require it to pay $100 million to refund customers, and take a number of steps to make it easier for individuals and businesses to cancel their phone services.These include providing a simple cancellation process that is easy to find and use, and being upfront about subscription plans and "negative options" — this happens when a customer agrees upfront to certain services, the provider then starts adding new ones, and treats the consumer's failure to reject the services or cancel the agreement as consent to be charged.
Vonage must also have express, informed consent before it can charge customers and must stop using dark patterns on its website.
[8]
"This record-breaking settlement should remind companies that they must make cancellation easy or face serious legal consequences," Samuel Levine, director of the FTC's Bureau of Consumer Protection said in a [9]statement .
To put the $100 million settlement in perspective: Vonage's 2021 revenue [10]topped $1.4 billion .
[11]Ericsson CEO Börje Ekholm leaves Alibaba board to focus on his main job
[12]Google burns few hours of profit to disappear location privacy lawsuit
[13]Education tech giant gets an F for security after sensitive info on 40 million users stolen
[14]Google fined $42.5m over misleading Android location settings in Australia
The SEC enforcement makes Vonage the latest big tech firm to come under fire by regulators and the courts for using dark patterns.
Last month Google agreed to [15]pay $85 million to settle a privacy lawsuit that accused the internet behemoth of using "dark patterns" in its user interfaces – deceptive controls and layout of settings – to fool people into providing their real-time whereabouts to the mega-corp for targeted advertising purposes.
Additionally, the FTC recently began its rule-making process to impose [16]stricter privacy rules on corporations, and during a recent public hearing, dark patterns frequently came up as one area that's [17]ripe for regulation. ®
Get our [18]Tech Resources
[1] https://www.theregister.com/2022/03/22/ericsson_ceo_leaves_alibaba_board/
[2] https://www.ftc.gov/system/files/ftc_gov/pdf/Vonage-Complaint.pdf
[3] https://pubads.g.doubleclick.net/gampad/jump?co=1&iu=/6978/reg_onprem/personaltech&sz=300x50%7C300x100%7C300x250%7C300x251%7C300x252%7C300x600%7C300x601&tile=2&c=2Y2WZj-Uq6tsyCqGTWIWz4QAAABA&t=ct%3Dns%26unitnum%3D2%26raptor%3Dcondor%26pos%3Dtop%26test%3D0
[4] https://pubads.g.doubleclick.net/gampad/jump?co=1&iu=/6978/reg_onprem/personaltech&sz=300x50%7C300x100%7C300x250%7C300x251%7C300x252%7C300x600%7C300x601&tile=4&c=44Y2WZj-Uq6tsyCqGTWIWz4QAAABA&t=ct%3Dns%26unitnum%3D4%26raptor%3Dfalcon%26pos%3Dmid%26test%3D0
[5] https://pubads.g.doubleclick.net/gampad/jump?co=1&iu=/6978/reg_onprem/personaltech&sz=300x50%7C300x100%7C300x250%7C300x251%7C300x252%7C300x600%7C300x601&tile=3&c=33Y2WZj-Uq6tsyCqGTWIWz4QAAABA&t=ct%3Dns%26unitnum%3D3%26raptor%3Deagle%26pos%3Dmid%26test%3D0
[6] https://pubads.g.doubleclick.net/gampad/jump?co=1&iu=/6978/reg_onprem/personaltech&sz=300x50%7C300x100%7C300x250%7C300x251%7C300x252%7C300x600%7C300x601&tile=4&c=44Y2WZj-Uq6tsyCqGTWIWz4QAAABA&t=ct%3Dns%26unitnum%3D4%26raptor%3Dfalcon%26pos%3Dmid%26test%3D0
[7] https://www.ftc.gov/system/files/ftc_gov/pdf/Vonage-Stipulated-Final-Order.pdf
[8] https://pubads.g.doubleclick.net/gampad/jump?co=1&iu=/6978/reg_onprem/personaltech&sz=300x50%7C300x100%7C300x250%7C300x251%7C300x252%7C300x600%7C300x601&tile=3&c=33Y2WZj-Uq6tsyCqGTWIWz4QAAABA&t=ct%3Dns%26unitnum%3D3%26raptor%3Deagle%26pos%3Dmid%26test%3D0
[9] https://www.ftc.gov/news-events/news/press-releases/2022/11/ftc-action-against-vonage-results-100-million-customers-trapped-illegal-dark-patterns-junk-fees-when-trying-cancel-service
[10] https://www.globenewswire.com/news-release/2022/02/24/2391990/0/en/Vonage-Reports-Fourth-Quarter-2021-Financial-Results.html
[11] https://www.theregister.com/2022/03/22/ericsson_ceo_leaves_alibaba_board/
[12] https://www.theregister.com/2022/10/04/google_privacy_lawsuit_settlement/
[13] https://www.theregister.com/2022/10/31/chegg_ftc_order/
[14] https://www.theregister.com/2022/08/12/google_accc_penalty/
[15] https://www.theregister.com/2022/10/04/google_privacy_lawsuit_settlement/
[16] https://www.theregister.com/2022/09/09/data_tracking_national_security_risk/
[17] https://www.theregister.com/2022/09/09/mozilla_cso_ftc_surveillance/
[18] https://whitepapers.theregister.com/
Prpgrammers Who Sold their Souls
An_Old_Dog
... are tip-tap-typing away, implementing these dark patterns in their web pages in exchange for the money.
Brian 3
But how much money did they make doing these things? I bet that $100 mill is just a license fee in comparison.
Yeah according to wiki annual revenue in 2020 was like $1.25 billion. They were doing this to all and sundry customers so there is simply no way $100 million covers the refunds. What about punitive damages? They were in the wrong. Why does the FTC think it is okay to license corporate wrongdoing?
When I get a service I am having trouble canceling, I call the credit card company and scream fraud (whether it really is or not). I don't play games with billing. I'll ask once for a refund or correction, then after that it means war.
My sister joined a gym in Toronto and was tricked into signing up for a "lifetime membership" (What? Who in their right mind would sign up for something like that. What if you have to move, or fall ill etc.). She had to move out of the area, and they refused to cancel the membership and kept billing. So she just called Visa and got them to stop the payments (and claw back the last 2).
Maybe things are different in Canada, but credit card companies generally will protect you from bad behaviour.