CFPB: Issues new guidance of negative option practices
- CFPB, a U.S. government agency that makes sure banks, lenders, and other financial companies treat you fairly
- Issued a new circular affirming that companies offering “negative option” subscription services
- Negative-option programs include subscription services that automatically renew unless the consumer affirmatively cancels
- Companies risk violating the law if they do not clearly and conspicuously disclose the terms of their subscription services
- Drawing from the Federal Trade Commission’s (FTC) recent policy statement and the past enforcement cases
- Deceptive practices that seek to trap consumers into subscriptions they don’t want are a violation of the law
