The Federal Trade Commission has joined an effort to alert consumers to online deceptive marketing connected to free trial offers that require individuals to cancel or opt-out of a recurring charge for future products or services.
The Director of the FTC’s Bureau of Consumer Protection, David C. Vladeck, appeared at a press conference with officials from Visa and the Better Business Bureau (BBB) today to caution consumers about the free trial feature, known as a “negative option.” In a negative option feature, a company takes a consumer’s failure to cancel a free trial offer as permission to begin charging for the service. While many merchants use this billing process appropriately, others pre-check consent boxes, bury the details of the offers in the fine print, terms and conditions, and make cancellations or returns difficult, catching consumers in a cycle of recurring charges for products and services they do not want.
“Free trial marketing can be convenient for consumers–if the terms are clearly spelled out beforehand,” Vladeck said. “Legitimate marketers don’t hide critical information about costs or cancellation policies to get their customers to agree to future charges.”
The FTC, Visa and the BBB offer tips to online shoppers on how to spot deceptive free trial offers, and how to deal with unauthorized charges:
Consumers who think they’ve been victims of deceptive marketing and who haven’t been able to resolve the issue directly with the merchant should call their card issuer to dispute the charge. They also may report their experiences to the FTC at www.ftc.gov/complaint or their local BBB at www.bbb.org. More information is available at www.visa.com/negativeoption.
Copies of the documents mentioned in this release are available from the FTC’s Web site at http://www.ftc.gov and from the FTC’s Consumer Response Center, Room 130, 600 Pennsylvania Avenue, N.W., Washington, DC 20580. Call toll-free: 1-877-FTC-HELP.