A lawsuit by the U.S. Federal Trade Commission alleges that Seattle-based bill payment company Doxo has repeatedly deceived consumers into thinking it’s an official channel for the companies they’re seeking to pay, adding unwanted fees and using web design tricks to get them to sign up for unwanted subscriptions.
The company, founded in 2008 and backed by investors including Jeff Bezos, categorically denied the allegations, saying it’s “committed to taking the necessary steps to comply with all regulations and exceed market standards for ensuring consumers are protected and empowered throughout the bill pay experience.”
The FTC’s lawsuit, filed Thursday in federal court in Seattle, accuses Doxo of using deceptive search ads and web design techniques known as dark patterns to mislead consumers into believing they’re paying billers directly.
The complaint says the company adds unwanted fees and mails paper checks on consumers’ behalf, in some cases causing them to miss payments and risk having their services cut off as a result.
In addition to the company, the FTC’s suit names as defendants two of Doxo’s co-founders: Steve Shivers, CEO; and Roger Parks, VP of business development.
Citing the allegations in the complaint, the FTC says in a news release that Shivers and Parks “have known from years of internal surveys and complaints from tens of thousands of consumers and hundreds of billers of the harms their business model caused consumers and have still failed to correct their unlawful actions.”
Doxo called the complaint a misrepresentation of its business, saying the company has helped more than 10 million people “in safely and efficiently paying their bills, eliminating extraneous costs, and improving and protecting their financial health” over its life as a company.
The FTC investigation “is inaccurate, and unjust, pushing forth a narrative that is a monumental step backward from the objective of reducing bill pay complexity and costs,” a Doxo spokesperson said in a statement, adding that the complaint “indicates a fundamental misunderstanding of the existing bill-pay market and the structural inefficiencies that almost always work against consumers.”
The statement added that the company “is committed to fighting on behalf of all consumers and billers who deserve a better bill pay experience, and we look forward to seeing their interests prevail.”
Doxo raised $18.5 million in funding in 2022, its first capital infusion since 2011, saying at the time that it was profitable with annual revenue of more than $40 million. Investors include Jackson Square Ventures, MDV, and Sigma Partners, in addition to Bezos Expeditions, the Amazon founder’s investment firm.
https://ift.tt/74VUwmS April 26, 2024 at 01:57PM GeekWire
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