SAN DIEGO (CNS) - The parent company of niche dating sites, including Christian Mingle, agreed to pay $500,000 in penalties and nearly $1 million in refunds to customers whose subscriptions were automatically renewed to settle a consumer protection action, San Diego County District Attorney Summer Stephan announced Monday.
The judgment filed in Santa Monica Superior Court will be shared equally among a task force of California prosecutors that also included district attorneys from Los Angeles, Santa Clara and Santa Cruz counties, as well as the city attorney of Santa Monica.
The dating sites for Spark Networks USA, LLC, were automatically renewing customer payments without their express prior consent as required by federal and state law, among other alleged violations of law, according to the task force.
"Consumers always have the right to know where their money is going and companies must comply with California's laws in order to ensure that consumers understand certain transactions will renew automatically," Stephan said. "This joint effort is a great example of how our Consumer Protection Unit works to protect people from unfair business practices in the marketplace and ensure that California's consumer protection laws are followed."
The judgment requires Jdate, Christian Mingle, and all of Spark's other dating sites to have full transparency with consumers about automatically renewing memberships.
The company now must:
-- clearly and conspicuously disclose the renewal terms;
-- get consumers' consent, through a separate check box (or similar mechanism) that does not include other terms and conditions;
-- send a clear summary of the renewal terms after consumers pay; and
-- allow consumers to cancel easily.
Spark Networks cooperated with the task force to reach the resolution.
According to prosecutors, online "subscriptions" and other automatically recurring charges have proliferated in the United States in recent years. Some renewals come after "free trials," where consumers need to cancel in time to avoid the charges.
Federal and state law requires businesses to make auto-renewals clear to consumers, and to get their "express, affirmative consent" before collecting any money. However, many businesses still don't follow the law, prosecutors said.