Online bill payment company Doxo settles FTC complaint

Online bill payment company Doxo will pay $2.1 million to settle an FTC complaint that alleged that the firm and two of its co-founders used misleading search advertising to impersonate consumers’ billers and misled consumers about junk fees they added to their bills.

According to a 2024 complaint, filed in the U.S. District Court for the Western District of Washington, the FTC contended that Doxo, and two of its co-founders, Steve Shivers and Roger Parks, used search ads and other advertisements to convince consumers to use the company’s third-party payment platform to pay auto loan, utility bills and other bills by disguising itself as the official payment vehicle for those bills. In addition, Doxo’s landing page often featured other companies’ names and occasionally their logos. However, the FTC said that Doxo did not have a relationship with the overwhelming majority of the companies it said were part of its payment network.

At the request of the FTC, U.S. District Judge Thomas S. Zilly found that Doxo violated the Restore Online Shoppers’ Confidence Act for failing to clearly disclose subscription terms and failing to obtain consumers’ consent for subscription charges.

“Misleading search text ads thwart consumers’ pursuit of information and undermine the integrity of the marketplace,” Christopher Mufarrige, Director of the FTC’s Bureau of Consumer Protection said.

The FTC contended that Doxo added extra junk “delivery fees,” which were not clearly disclosed, onto the bills it paid on behalf of consumers and deceptively registered consumers for its recurring subscription program.

“For example, Doxo failed to clearly and conspicuously disclose that delivery fees are waived only for certain payment methods and failed to clearly and conspicuously disclose the price of the subscription,” the FTC said.

Under the proposed order settling the FTC’s allegations, Doxo will be required to pay $2.1 million, which will be used for consumer redress. Doxo, Shivers and Parks also will be prohibited from:

• “Misrepresenting their affiliation with billers when promoting or offering bill payment services and from using a biller’s website address in any search advertisement or using the branded name or logo of any biller in a manner that misrepresents that Doxo is affiliated with the biller.”
• “Making misrepresentations regarding the amount consumers will pay, the nature or purpose of any fee or charge and the total cost or fees to use the defendants’ bill pay platform.”
• “Using false representations to obtain customers’ financial information.”
• “Making misrepresentations regarding a negative option feature,” and about the terms of the feature, “including the ability to cancel” (they also “must notify consumers when they will be charged for a particular good or service, the deadline that customers must act to prevent or stop charges and the amount consumers will be charged unless they take steps to prevent the charges”); and
• “Charging consumers without obtaining their informed consent.”