HomeAdvisor’s $7.2 million proposed settlement with FTC hits home with small businesses, gig workers
By
Lesley Fair
January 27, 2023
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It’s a match that should have been made in Home Improvement Heaven: consumers looking for service providers and service providers looking for new clients. But the FTC alleged in a 2022 complaint that Denver-based HomeAdvisor, Inc. – a company affiliated with Angi, formerly known as “Angie’s List” – used misleading tactics to sell home improvement project leads to many small businesses operating in the gig economy. A proposed settlement in the case includes $7.2 million for refunds.
HomeAdvisor recruits service providers – for example, contractors or lawn care businesses – to join its network for a typical annual fee of $287.99. Once they’re enrolled, HomeAdvisor sells them – for an additional fee – leads of people who supposedly have home repair or maintenance projects. As part of the membership package, many service providers have paid an additional $59.99 for an optional one-month subscription to a service called mHelpDesk, software for scheduling appointments and processing payments.
The FTC charged that HomeAdvisor made false or deceptive claims about the quality and source of its leads. For example, HomeAdvisor claimed that service providers will get leads matching their skills and in their preferred locale, but according to the complaint, many of them didn’t. In addition, the FTC says HomeAdvisor often told service providers that its leads result in jobs at rates much higher than the company could substantiate. Another allegedly deceptive practice: misrepresenting that the optional one-month mHelpDesk subscription was free.
In addition to the $7.2 million financial judgment, the proposed order prohibits HomeAdvisor from making false or misleading claims about leads and bars misleading “free” representations.
Once the proposed settlement is published in the Federal Register, the FTC will accept comments for 30 days. Information about refunds for service providers won’t be available until the settlement is final. Bookmark the FTC’s refund page and check back later for more information about eligibility.
What can businesses glean from the announcement? The proposed settlement reflects the FTC’s commitment to challenging unfair, deceptive, or anticompetitive practices in the gig economy, as articulated in its September 2022 Policy Statement on Enforcement Related to Gig Work. It also builds on other efforts to protect gig workers and small businesses, including the Notice of Penalty Offenses on Money-Marking Opportunities and the pending Advance Notice of Proposed Rulemaking on Earnings Claims.
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Consumer Alert
Pass It On in 2023: Renewing fraud prevention
By
Bridget Small
Consumer Protection Specialist, FTC
January 24, 2023
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If you’re one of the resourceful, dedicated people who uses Pass It On and Pásalo materials to help older adults avoid scams, thank you! You’re part of an enormous network that’s shared more than 17 million fact sheets and bookmarks, in English and Spanish, at coffee chats, financial literacy classes, information fairs, and in libraries, lobby tables, and other community meeting places over the last eight years. Now we’ve got more reasons for you to Pass It On.
Check out our refreshed Pass It On website. We’ve added new online and print information about business impersonators and investment scams and updated our existing materials about common scams that often affect older adults — like romance, tech support, and grandkid scams. You’ll also find updated downloadable Power Point presentations about the 13 topics Pass It On covers — complete with speaker’s notes — and a print Sample Pack with 13 fact sheets to enhance your presentations. Don’t worry, you’ll still find straightforward advice for older adults that respects their lifetime of experience.
For the next seven weeks, we’re hosting short webinars about new Pass It On materials for people who do outreach and education with older adults. We’ll talk through the process for ordering free print materials to enhance your trainings and group presentations, demonstrate the Power Point presentations for each topic; and talk about ideas for sharing Pass It On with your community. Want to learn how to link Pass It On to your website? We’ve got you covered. Check out the schedule below and find one focused on your area of focus: aging services, community support, law enforcement, or library staff and volunteers.
Webinars — Reaching Older Adults about Scams: Pass It On
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https://consumer.ftc.gov/features/national-consumer-protection-week?utm_source=govdelivery
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National Consumer Protection Week
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March 5 – March 11, 2023
National Consumer Protection Week (NCPW) is a time to help people understand their consumer rights and avoid frauds and scams.
Looking for ways to bring NCPW to your neighborhood? Join one of our free upcoming webinars: “Celebrating NCPW In Your Neighborhood: Outreach & Program Ideas” to learn how:
- Wednesday, January 25th at 3pm EST: Event Page
- Tuesday, January 31st at 3pm EST: Event Page
- Wednesday, February 1st at 11am EST: Event Page
Stay tuned for 2023 events and resources!
Resources for local press and social media outreach
Contact your local television, radio or cable access station. Offer to talk about a consumer protection topic you care about, or tell their audience about your NCPW events. Use the following materials to let them know about your organizations’ involvement in NCPW:
Personalize this article template with your event details.
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