FTC Lawsuits Resulted in $324 Million in Refunds in 2023

Federal Trade Commission (FTC) lawsuits resulted in over $324 million in refunds to consumers in 2023.

That total includes money returned to consumers as a result of all FTC cases, whether the refund program was administered by the FTC, other federal agencies or the defendants, the agency said in its annual report on refunds released Friday (June 20).

The FTC itself refunded $137.7 million, and 1.4 million people cashed FTC payments, according to the report.

The FTC sent first distributions totaling $134 million in 15 cases in 2023, the report said.

The largest first distribution payment sent by the FTC in 2023 resulted in $99.4 million sent to consumers who were charged fees after trying to cancel their Vonage phone plans, the FTC said in a Friday press release.

The next-largest first distribution payments sent during the year were for cases involving American Financial Benefits Center ($9.1 million), Consumer Health Benefits Association ($6.9 million), Arete Financial ($3.3 million) and Passport Automotive Group ($3.3 million), according to the report.

The FTC’s case against Vonage involved junk fees levied on subscribers, the agency said when announcing a settlement in November 2022. The agency alleged that the company created obstacles to prevent customers from stopping recurring charges for its phone services and that it used dark patterns to continue illegally charging subscribers even after they spoke to an agent directly and request cancellation.

Samuel Levine, director of the FTC’s Bureau of Consumer Protection, said in the settlement announcement: “This record-breaking settlement should remind companies that they must make cancellation easy or face serious legal consequences.”

The agency’s case against American Financial Benefits Center alleged a student loan debt relief scam in which the defendants contacted consumers, pretended to be affiliated with the U.S. Department of Education, and charged illegal upfront fees and monthly fees, according to an FTC web page about the refund program.

The FTC’s case against Consumer Health Benefits Association alleged that the company sold misleading medical discount plans to people who were looking for medical insurance and then made it difficult for customers to get refunds or cancel their plans, according to its page about that refund program.