FTC, VISA, BBB Condemn Bad Billing

LOS ANGELES — Companies involved in fraudulent billing practices beware: the U.S. Federal Trade Commission (FTC), along with Visa and the Better Business Bureau are coming after you.

The FTC recently announced a new initiative in cooperation with Visa and the BBB "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."

Sound familiar? It should — it is the process by which most adult paysite memberships are sold today.

While the Commission is quick to point out that both free trial offers and recurring subscriptions are legitimate marketing methods, the growing abuse of these sales techniques is raising eyebrows. Director of the FTC's Bureau of Consumer Protection, David C. Vladeck, is particularly concerned about a free trial feature known as the "negative option."

According to the Commission, 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."

Among the advice to consumers offered by FTC, Visa and BBB representatives is to read and understand all terms and conditions and to pay particular attention to any pre-checked boxes before you submit your payment card information for an order. They also advise that if the situation cannot be resolved with the merchant, then the card issuer should be contacted to dispute the charge.

For its part, Visa reports that it has terminated more than 100 scammers over the past six months for using bogus marketing techniques, such as hiding cancellation links, using pre-checked cross-sales with undisclosed terms, and other offenses, including using credit card information that was required "to pay for shipping and handling" for multiple additional, often recurring, charges.

"We've been monitoring this situation from this past summer in particular," Visa VP William M. Sheedy said. "Consumers are being fleeced."

"The game here is to get people hooked, keep them on the hook for monthly charges as long as you can, and only stop making those charges when you're forced to," BBB Online VP Stephen Salter said, adding "The product is irrelevant to getting the charges on the card."

Related:  

Copyright © 2025 Adnet Media. All Rights Reserved. XBIZ is a trademark of Adnet Media.
Reproduction in whole or in part in any form or medium without express written permission is prohibited.

More News

TrustyFans Introduces New Blog

Creator directory TrustyFans has introduced an official blog to its site, titled "From Hidden to Hype."

JustFor.fans' Dominic Ford Featured in Wired Magazine

JustFor.fans Founder and CEO Dominic Ford is featured in a new article in Wired Magazine, titled "The Internet Revolutionized Porn. Age Verification Could Upend Everything."

Dr. Charlotte Gaydos Joins ProDx Health Advisory Board

Dr. Charlotte Gaydos has joined the Advisory Board of ProDx Health.

Aylo Fined $5 Million as FTC, Utah Settle Safety Practices Complaint

The Federal Trade Commission and the state of Utah on Wednesday settled a complaint against Aylo, requiring the company to pay a $5 million penalty and implement measures to prevent illegal content from appearing on its sites.

New AI Companion Platform 'Pornstar.love' Launches

Pornstar.love, a new AI companion platform, has officially launched.

Pineapple Support, Stripchat to Host 'Navigating Thoughts of Suicide' Support Group

Pineapple Support and Stripchat are hosting a free online support group to help performers deal with suicidal ideation.

Plaiir Names Cade Maddox as Lead of Creator Relations

Networking platform Plaiir has appointed Cade Maddox as its new lead of creator relations.

Go.cam Launches 'One-Line Integration' Verification Solution

Go.cam has introduced a one-line code integration for age verification.

XBIZ Amsterdam to Debut 'Behind the Lens' Screening Series

XBIZ is pleased to announce the debut of “Behind the Lens,” a new screening series presenting discussions with noted directors, taking place at the upcoming annual European conference, XBIZ Amsterdam.

'White Rabbit' Party Headed for XBIZ Amsterdam

XBIZ is pleased to announce the White Rabbit Party, an XBIZ Amsterdam special event set to take place Wednesday, Sept. 3.

Show More