Consumer Complaints About Auto-Renewal Charges on the Rise

Complaints are mounting about auto renewal charges assigned to customers’ accounts. If you weren’t paying attention when you signed up for a subscription deal a couple of months ago or took advantage of a free trial offer, you may find new auto-renewal charges on your credit card or bank account.

Auto-Renewal Charges Prompt Customer Complaints and Lawsuits

These endless charges may be difficult to spot and even harder to cancel. Representatives from the National Consumer Law Center report that the complaints over auto-renewal charges have been rising in recent years because companies make it as easy as possible to auto-renew while also making it hard to discontinue the services. Free trial offers, annual memberships, recurring services and low-priced subscriptions have all been tied to unexpected auto renewal charges.

Many consumers don’t realize that when the initial period expires, charges for the services and goods will continuously be billed to their credit cards. In other situations, consumers may agree to the terms and accept the auto-renewal charges in the short term, but can’t figure out how to cancel the service if they no longer want it. Mountains of complaints have led to public officials, regulators and lawyers all taking notice of these controversial practices.

The Federal Trade Commission first pursued cases regarding auto renewal charges in October of 2014, through the Restore Online Shopper’s Confidence Act. Those were the first cases involving auto renewal charges since the law was put into place in 2010. Under those laws, companies are prohibited from charging consumers online unless all the terms of the purchase are clearly disclosed and the company has obtained the informed consent for the auto-renewal charges from the consumer. Although some lawsuits have led to settlements and updated terms for the specific companies named in the legal action, problems continue across the board as everyone from gyms to online subscription boxes are making use of auto-renewal charges.

Some consumers report that after signing up for a service, they don’t realize that the charge continues every single month until it is turned off. Canceling the auto-renewal charges is also a problem. Sometimes an email or phone call will end the charges but often it is nearly impossible to connect with a human representative at the company to terminate the services.

Consumers should be more vigilant than ever about the possibility of auto-renewal charges on their credit cards and bank accounts. A variety of apps have been developed to identify auto-renewal charges.

Consumers should also be aware of negative option renewals, which means that your credit card is automatically charged for a service or good unless you specifically opt out. Free 30-day trial offers are some of the most common basis of complaints over auto-renewal charges. While you can contact your credit card provider to discontinue the payments, you will also have to identify the merchant and figure out how to cancel the auto-renewal charge with them or they may report you to the financial credit bureaus for nonpayment.

The attorneys at Bradley/Grombacher are currently investigating claims from people who believe that they have been inappropriately subjected to auto renewal charges. Fill out the form on this page to learn more about your legal rights.