The US Federal Trade Commission (FTC) stated a record-breaking $100 million settlement imposed on Ericsson-owned VoIP company Vonage for customer service failures should act as a warning to all operators, as the business agreed to a range of measures to tackle so-called dark pattern tactics.

In a statement, the FTC explained Vonage had accepted a proposed settlement to legal action it brought over company policies which made it harder to cancel contracts than it was to sign up.

Samuel Levine, director of the FTC’s Bureau of Consumer Protection, said the regulator had delivered on “our commitment to protect consumers from illegal dark pattern tactics by companies that prevent” customers from “cancelling their services”.

A Vonage representative put a positive spin on the matter, telling Mobile World Live it felt “it was in the best interests of our customers, partners and employees to come to a settlement” so the company could “focus on creating” communications technology.

Vonage’s penalty will be used to refund affected customers. The company also has to make its cancellation process simple and transparent, and stop charging consumers without their consent through an automated monthly billing process.

Dark tactics
The FTC alleged Vonage’s cancellation policy left “consumers and businesses on the hook for services they no longer want”. It highlighted a move by the company in 2017 which required customers to speak to an agent to close their account as an example of policies designed to make it hard to quit.

Vonage also made it hard to find the correct phone number for the process, did not consistently transfer users who called its generic customer service number, reduced the hours the line was available for and failed to follow through on promised call-backs, the FTC claimed.

The FTC cited an internal Vonage email stating customers were “sent in a circle when they want to downgrade or remove the service”.

Vonage agreed to offer clear disclosures about any recurring charges and implement a simple cancellation process which includes enabling customers who sign up through a mobile app to also employ this to end their contract.