Consumer Payments

FTC Nets $6.4B In Refunds For Consumers

The Federal Trade Commission (FTC) announced Friday that enforcement actions over the past year have returned $6.4 billion to consumers.

In a press release, the FTC said that of the $6.4 billion consumers received in refunds, $391 million was sent directly to 6.28 million consumers. The Bureau of Consumer Protection unit obtained 168 court orders for more than $12.72 billion between July 1, 2016, and June 30, 2017. That amount doesn’t include judgments that were suspended by the court due to defendants’ inability to pay.

In some of the cases, the court orders called on the defendants to pay back the consumers directly, including more than $6 billion coming from Volkswagen. The car company ran afoul of the law when it was caught changing emissions ratings on some of its vehicles. In many cases, the FTC itself returned the money to consumers after defendants paid their judgments. Of the checks issued by the FTC, 72 percent were cashed. On average, the government agency paid 4.85 percent in administrative costs.

In a landmark agreement reached between the FTC and Amazon this spring, the online retail giant will end appeals to last year’s federal district court findings that Amazon billed consumers for unauthorized in-app charges incurred by children using mobile apps. The court found that Amazon had failed to get parents’ consent for in-app charges. All told, some $70 million in unauthorized in-app charges will soon be eligible for refunds.

“This case demonstrates what should be a bedrock principle for all companies – you must get customers’ consent before you charge them,” said Thomas B. Pahl, acting director of the FTC’s Bureau of Consumer Protection in a statement. “Consumers affected by Amazon’s practices can now be compensated for charges they didn’t expect or authorize.”

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