Feds Issue Warning Over “Dark Patterns”

(PresidentialWire.com)- A report on how businesses use “dark patterns” in advertising to entice potential customers, manipulate them into making purchases, and compromise their privacy in the process was released on Thursday by the Federal Trade Commission (FTC).

Samuel Levine, head of the FTC’s Bureau of Consumer Protection, stated that their analysis illustrates how increasingly businesses are employing digital dark patterns to deceive individuals into buying things and handing away their personal information. The message that these traps will not be tolerated is sent loud and clear by this report and our cases.

The use of typical marketing strategies like ads masquerading as independent content, burying crucial terms in corporate speak, tricking customers or website visitors into providing personal information, using deceptive colors, pre-checked consent boxes, language and emotion to induce purchases, deceptively signing up for content, tricking customers into recurring charges, and making it incredibly difficult to unsubscribe are all examples of dark patterns.

E-increased commerce’s popularity in recent years has made it simpler for businesses to target customers using various strategies.

The FTC research, “Bringing Dark Patterns to Light” (pdf), looked at how these strategies may infringe on consumer protection rules and conceal, subvert, or hinder consumer choice. The FTC has reportedly filed lawsuits against businesses that employ these strategies to defraud customers.

After falsely claiming to have “no hidden costs,” online lender LendingClub Corp. was sued by the FTC in 2018. The company had hidden up-front fees of hundreds or even thousands of dollars deducted from the loans.

Other claims against LendingClub include withdrawing money from customer’s bank accounts without their permission and misleading customers about their eligibility for loans when they weren’t.
Following the court’s ruling, LendingClub agreed to reimburse 61,990 customers who had been hit with unauthorized charges for more than $9.7 million.

The Federal Trade Commission (FTC) has fined another company, ABCmouse, a subsidiary of the online learning company Age of Learning Inc., $9.7 million for using harmful option marketing and billing practices. The marketing technique caused thousands of clients to have their subscriptions renewed and membership fees charged without approval between 2015 and 2018.