The U.S. Federal Trade Commission has filed a lawsuit against Seattle-based bill payment company Doxo, alleging that the company has deceived consumers into thinking it is an official channel for the companies they are seeking to pay. The lawsuit accuses Doxo of using deceptive search ads and web design techniques to mislead consumers into believing they are paying billers directly, as well as adding unwanted fees and mailing paper checks on consumers’ behalf. The FTC’s lawsuit names Doxo’s co-founders, Steve Shivers and Roger Parks, as defendants.
Doxo has denied the allegations, stating that it is committed to complying with all regulations and exceeding market standards to ensure that consumers are protected and empowered throughout the bill pay experience. The company has helped over 10 million people in safely and efficiently paying their bills, eliminating extraneous costs, and improving and protecting their financial health since its founding in 2008. Doxo’s spokesperson called the FTC’s complaint a misrepresentation of its business and expressed their commitment to fighting on behalf of all consumers and billers for a better bill pay experience.
The FTC’s lawsuit accuses Doxo of using dark patterns in its web design to trick consumers into signing up for unwanted subscriptions and offsetting fees, causing some consumers to miss payments and risk having their services cut off. The complaint alleges that Shivers and Parks, as co-founders of the company, have known about the harm their business model causes consumers but have failed to correct their actions. Despite the allegations in the complaint, Doxo remains profitable with annual revenue of over $40 million, having raised $18.5 million in funding in 2022 – its first capital infusion since 2011.
Doxo has been backed by investors including Jeff Bezos and investment firms Jackson Square Ventures, MDV, and Sigma Partners. While the company refutes the allegations made by the FTC, the lawsuit raises concerns about the deceptive practices employed by Doxo and the impact on consumers’ financial well-being. The company’s commitment to providing a better bill pay experience is called into question in light of the allegations, raising concerns about transparency and consumer protection in the bill payment industry.
The outcome of the lawsuit will determine the future of Doxo and its co-founders, as well as shed light on the practices used by bill payment companies in the industry. The allegations made by the FTC highlight the importance of consumer protection and transparency in the bill payment process, ensuring that consumers are not misled or deceived by companies like Doxo. As the case progresses through federal court in Seattle, the implications for the bill pay market and consumer rights will become clearer, shaping the future of the industry and the level of trust consumers can place in bill payment services.
