County prosecutors warned residents Friday that companies may keep consumers on the hook with the automatic subscription renewal scam.
“It’s a deceptive scam disguised as an enticing offer, and it happens all the time,” Deputy District Attorney Hoon Chun said in a video published Friday.
Some businesses lure in customers offering a complimentary one-month trial for a service. Once the promotional period is over, companies may automatically begin charging you.
“In the automatic subscription renewal scam, companies get customers to pay for subscriptions they may not intend to renew by automatically charging their accounts or credit cards,” said a news release from the L.A. County District Attorney’s Office.
Businesses may hide important details in the fine print, including the possibility that a subscription automatically will be renewed unless canceled, the price will increase after a discount has expired — without clearly stating the new amount in advance — or they may make it difficult for customers to cancel their subscriptions.
A new state law went into effect July 1 to strengthen consumer protections against automatic subscription renewals. Businesses are required to provide a clear and conspicuous explanation of price changes after free trials or gift offers, get consumers’ affirmative consent before charging them for automatic renewals and give information to customers about how to cancel their subscriptions.
In response, the District Attorney’s Office offered the following tips:
- Before signing up for a free subscription or membership trial, check out the renewal policy and price.
- If a business fails to clearly and conspicuously disclose that a subscription will be auto-renewed, the consumer is not obligated to pay any auto-renewed charges and may keep for free any products that the business sent to the consumer.
- Dispute unauthorized subscription charges with your bank or credit card company.
Chun explains how the scam works in this video: http://da.lacounty.gov/community/fraud-alerts/automatic-subscription-renewal-scam.
Those interested in more information can follow @LADAOffice on Twitter and Instagram for up-to-date news. The above information was shared with The Signal via a news release from the L.A. County District Attorney’s Office.