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Home / Business / Dating app maker Match sued by FTC for scams – TechCrunch

Dating app maker Match sued by FTC for scams – TechCrunch



They're just not in you. Or maybe it was a cure? The US Federal Trade Commission announced on Wednesday that it has sued Match Group, the owner of just about all dating apps – including Match, Tinder, OKCupid, Hinge, PlentyofFish and others – for fraudulent business practices. According to the FTC, Match tricked hundreds of thousands of consumers into buying subscriptions, exposing customers to the risk of fraud and engaging in other deceptive and unfair practices.

The suit only focuses on Match.com and boils down to this: Match.com not only turned a blind eye to the huge problem of bot and scams, the FTC claims . It deliberately earned it. And it did trick users into a core part of their business practice.

The charges against Match are quite significant.

The FTC states that most consumers are unaware that 25 to 30 percent of Match registrations per day come from fraudsters. This includes romance scams, phishing scams, fraudulent advertising and blackmail scams. Over the course of a few months from 201

3 to 2016, more than half of the communications that took place on Match from the accounts of the company were identified as fraudulent.

Bots and scammers, of course, are a problem all over the net. The difference is that in Match's case, it indirectly benefited from this, at the expense of consumers, the suit claims.

The dating app sent marketing emails (i.e., "You caught his notice") to potential subscribers about new messages in the app's inbox. However, it did so after it had already labeled the sender's message as a suspected bot or fraud.

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"We believe Match.com led people to pay for subscriptions through messages the company knew were from scammers," said Andrew Smith, director of the FTC's Bureau of Consumer Protection. "Dating services online should obviously not use romantic scammers as a way to grease their bottom line."

From June 2016 to May 2018, Match's own analysis found 499,691 consumers who signed up for a subscription within 24 hours of receiving an email message the fraudulent communication, the FTC said. Some of these consumers joined the Match only to find out the message that made them a fraud. Others signed up after Match deleted the scam account after being scammed. It allowed them to find the account sending a message to them now was "unavailable."

In any case, the victims were now stuck with a subscription – and trouble when they tried to cancel.

Due to Match's alleged "misleading" advertising, billing and cancellation practices, "consumers will often try to reverse their fees through their bank. Match would then ban users from the app.

In this regard, Match is also in violation of the "Restore Online Shoppers & # 39; Confidence Act" (ROSCA) by failing to offer an easy way for customers to stop recurring costs, the FTC says. In 2015, one Match internal document showed how it took over 6 clicks to cancel a subscription, often leading consumers to think they canceled when they didn't.

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And the suit claims that Match tricked people into a six-month free subscription by promising them that they wouldn't have to pay if they didn't meet anyone. However, it did not adequately reveal that there were other, specific steps that needed to be taken that involved how to use their subscription or redeem their free months.

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Match naturally enough, disputes the case. It claims that it is actually a fight against fraud and that it manages 85% of potentially incorrect accounts in the first four hours, often before they become active. And it handles 96% of these fake accounts in a single day.

“For nearly 25 years, Match has been focused on helping people find love and fighting off criminals trying to benefit users. We have developed industry-leading tools and A.I. which blocks 96% of bots and fake accounts from our site in a 24-hour period and is relentless in our quest to get rid of the site for these malicious accounts, "Match said in response to the news. "The FTC has misrepresented internal emails and relied on cherry-picked data to make outrageous allegations, and we intend to vigorously defend those claims in court."

The Match Group, as you may know, loves to have its day in court.

The FTC's lawsuit is not the only one facing Match's parent company because it does not (allegedly) play fair.

A group of Tinder executives is currently suing Match and its controlling shareholder IAC for manipulating financial data to strip them of the stock options. The suit today continues, although some plaintiffs had to waive because Match had sneaked an arbitration clause in the employees' recent acknowledgment statements.

Now the former plaintiffs are acting as witnesses, and Match is trying to claim that the trial funded agreement compensates them for their testimony in violation of the law. The judge called that motion a "smoke screen" and an attempt to "trial [the plaintiffs] to death until they settled."

Match Group also discussed it with Tinders rival Bumble, which it failed to acquire twice. It filed lawsuits for infringed patents, which Bumble said were intended to bring down the valuation. Bumble then sued and dropped its own $ 400 million lawsuit over Match for fraud in acquiring Bumble's trade secrets.

In the latest lawsuit, FTC Match is asking to repay the "bad" money and wants to impose civil penalties and other relief. While the financial impact may not be enough to take down a company with Match's resources, the headlines from the lawsuit could lead to an increase in negative consumer sentiment over Match and online dating in general. It is a business that has become common and normalized in society, but also has a reputation for being a bit of a scam at times. This suit won't help.

And given that Match Group runs a majority of America's top dating apps, it could have a bigger, run-down effect on the broader business.

The FTC suit is available below.


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