The Federal Trade Commission (FTC) has filed a lawsuit against Uber, accusing the company of deceiving its customers with Uber One subscription service.
According to the FTC, Uber signed up users for the service without their consent, falsely advertised the savings it promised, and created a complex cancellation process that made it difficult for users to terminate their subscriptions.
Uber One, which costs $9.99 per month, is marketed as a service offering discounts on Uber’s ride-hailing and delivery platforms. However, the FTC claims that the savings, which Uber said amounted to $25 a month, were exaggerated and did not account for the subscription fee.
Again, Uber allegedly buried key details about the service in hard-to-read text, making it easy for customers to miss important information.
The FTC also accused Uber of charging users who had signed up for a free trial before their billing date, and of creating a labyrinthine cancellation process. Customers, the FTC says, could be forced to go through up to 23 screens and perform up to 32 actions just to cancel their subscriptions.
In some cases, users reported being told they needed to contact customer support to cancel but were given no clear way to do so. Others claimed Uber charged them for another billing cycle while they were still waiting to hear back from support.
“The American people are fed up with unwanted subscriptions that are nearly impossible to cancel,” said FTC Chairman Andrew Ferguson. “This action is part of our ongoing effort to protect consumers from deceptive practices in the subscription services market.”
In response, Uber has denied any wrongdoing. A spokesperson for the company said, “Uber does not sign up or charge consumers without their consent, and cancellations can now be done anytime in-app, typically in 20 seconds or less.” Uber also dismissed the FTC’s investigation, with a company representative accusing the agency of rushing the process and acting on “unvetted allegations.”
Despite Uber’s defence, the FTC is pushing for the company to stop its alleged deceptive practices and to pay monetary relief to affected customers.
Uber has a large global customer base, with 30 million members in 34 countries, and the service has been growing at an impressive rate. Uber One’s membership fees are expected to surpass $1 billion in 2024.
This isn’t Uber’s first run-in with the FTC. The company has previously settled allegations over misleading privacy claims and exaggerated earnings forecasts for drivers.
However, this latest legal challenge is about the transparency of Uber’s business, particularly regarding subscription services and customer cancellations.
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