Consumer protection: Doxo pays $2.1 million over bill-pay fees

The news: Online bill payment company Doxo will pay $2.1 million to settle Federal Trade Commission allegations that it and two co-founders, Steve Shivers and Roger Parks, used misleading search ads to impersonate consumers’ billers and misled people about the fees it added to their bills. The FTC announced the proposed stipulated order on August 17. The money will be used for consumer redress. The order was filed in the U.S. District Court for the Western District of Washington, and it has the force of law once the judge approves and signs it.

Why it matters: Millions of households pay utility, car loan and other bills online, and many start with a web search. The FTC’s 2024 complaint alleged that Doxo’s ads and landing pages made it look like the official payment channel for those bills, often displaying other companies’ names and sometimes logos. According to the agency, Doxo had no relationship with the overwhelming majority of the companies it claimed were part of its payment network.

The second problem was cost. The FTC alleged Doxo tacked on “delivery fees” that were not clearly disclosed and failed to say that the fees were waived only for certain payment methods. It also alleged the company signed consumers up for a recurring subscription program without clearly disclosing the price. At the FTC’s request, a federal court found that Doxo violated the Restore Online Shoppers’ Confidence Act by not clearly disclosing subscription terms and not obtaining consent for subscription charges.

By the numbers:

• $2.1 million: the settlement payment, earmarked for consumer redress
• 2024: the year the FTC filed its complaint
• 2-0: the Commission vote approving the stipulated final order

The big picture: The order prohibits Doxo, Shivers and Parks from misrepresenting any affiliation with billers, including through search ads that use a biller’s web address, name or logo. They also may not misstate what consumers will pay or the purpose of any fee, may not use false statements to obtain financial information, and must disclose when and how much consumers will be charged and the deadline to stop a charge. They cannot charge consumers without express informed consent.

Christopher Mufarrige of the FTC’s Bureau of Consumer Protection said misleading search text ads “thwart consumers’ pursuit of information.”

What’s next: The court must approve the order. For households, the habit that avoids this kind of problem is going directly to the biller’s own website or app, or typing the address yourself, rather than clicking the first ad that appears in search results.