Federal Trade Commission (FTC) law enforcement actions have reportedly resulted in more than $324 million in refunds to consumers in 2023, the agency said in its annual report on refunds.
The FTC Annual Report on Refunds to Consumers provides “a breakdown of the total amount refunded by the FTC nationally, as well as the amount mailed to each state.”
The report also includes “a list of cases in which the agency sent first distribution payments in 2023.”
For example, the largest first distribution “resulted in $99 million sent to consumers who were charged fees after trying to cancel their Vonage phone plans.”
In addition to statistics about each distribution in 2023, the report also “includes information about how the FTC provides refunds and determines who is eligible for a refund in cases where there is money to return to consumers.”
The FTC also has interactive dashboards online “with more detailed information about consumer refunds at ftc.gov/exploredata.”
The Federal Trade Commission works to promote competition and protect and educate consumers.
The FTC will never demand money, make threats, tell you to transfer money, or promise you a prize.
In another separate update, it was noted that the Federal Trade Commission is taking action against software maker Adobe and two of its executives, Maninder Sawhney and David Wadhwani, for “deceiving consumers by hiding the early termination fee for its most popular subscription plan and making it difficult for consumers to cancel their subscriptions.”
A federal court complaint filed by the Department of Justice upon notification and referral from the FTC charges that Adobe pushed consumers toward the “annual paid monthly” subscription “without adequately disclosing that cancelling the plan in the first year could cost hundreds of dollars.”
Wadhwani is the president of Adobe’s digital media business, and Sawhney is an Adobe vice president.
Samuel Levine, Director of the FTC’s Bureau of Consumer Protection:
“Adobe trapped customers into year-long subscriptions through hidden early termination fees and numerous cancellation hurdles. Americans are tired of companies hiding the ball during subscription signup and then putting up roadblocks when they try to cancel. The FTC will continue working to protect Americans from these illegal business practices.”
After 2012, Adobe shifted principally to a subscription model, “requiring consumers to pay for access to the company’s popular software on a recurring basis. Subscriptions account for most of the company’s revenue.”
According to the complaint, when consumers purchase a subscription through the company’s website, Adobe pushes consumers to its “annual paid monthly” subscription plan, pre-selecting it as a default.
Adobe prominently shows the plan’s “monthly” cost during enrollment, but it buries the early termination fee (ETF) and its amount, which “is 50 percent of the remaining monthly payments when a consumer cancels in their first year.”
Adobe’s ETF disclosures are “buried on the company’s website in small print or require consumers to hover over small icons to find the disclosures.”
Consumers complain to the FTC and the Better Business Bureau about the ETF, according to the complaint.
These consumers report they were not aware of the existence of the ETF or that the “annual paid monthly” plan required their subscription to continue for a year. The complaint notes that Adobe has “been aware of consumers’ confusion about the ETF.”
Despite being aware of consumers’ problems with the ETF, the company “continues its practice of steering consumers to the annual paid monthly plan while obscuring the ETF, according to the complaint.”
In addition to failing to disclose the ETF to consumers when they subscribe, the complaint also alleges that Adobe uses “the ETF to ambush consumers to deter them from cancelling their subscriptions.”
The complaint also alleges that Adobe’s cancellation processes are “designed to make cancellation difficult for consumers.”
When consumers have attempted to cancel their subscription on the company’s website, they have been “forced to navigate numerous pages in order to cancel.”
When consumers reach out to Adobe’s customer service to cancel, they “encounter resistance and delay from Adobe representatives.”
Consumers also experience other obstacles, “such as dropped calls and chats, and multiple transfers.”
Some consumers who thought they “had successfully cancelled their subscription reported that the company continued to charge them until discovering the charges on their credit card statements.”
The complaint charges that Adobe’s practices “violate the Restore Online Shoppers’ Confidence Act.”
For more details, check here.