The Federal Trade Commission (FTC) is sending out almost $100MN in refunds to Vonage consumers after denouncing the vendor for "junk fees" and "illegal dark patterns" in November 2022.
Those dark patterns include actions that made it difficult for consumers to cancel their subscriptions.
Moreover, the FTC found that Vonage continued to charge customers illegally after they spoke to a service agent directly requesting a cancellation.
In other cases, agents told customers they must pay an unexpected termination fee – which Vonage didn't clearly disclose in the onboarding process.
Often, that fee would cost hundreds of dollars.
After the investigation, Vonage reached a settlement with the government agency to pay up, and – one year later – those refund payments will reach the 389,106 affected consumers.
Now, Vonage must also ensure its cancellation process is "simple and transparent" and "stop charging consumers without their consent".
Speaking after the initial ruling, Samuel Levine, Director of the FTC's Bureau of Consumer Protection, added:
[The action] delivers on our commitment to protect consumers from illegal dark pattern tactics by companies that prevent consumers from canceling their services.
"This record-breaking settlement should remind companies that they must make cancelation easy or face serious legal consequences."
Importantly, this only relates to Vonage’s consumer business – not its B2B dealings.
Indeed, the actions target consumer accounts, valued from $5 to around $50 each month.
However, the FTC also suggested that the issue at Vonage stretched further, noting that the vendor left "consumers and businesses on the hook for services they no longer want."
Such practices are becoming an increasing concern across the CX industry, with reports elsewhere of other issues like vendor lock-ins and arbitrary fee increases.