Care.com agrees to settle FTC lawsuit on marketing, cancellations

By Connor Hart

Care.com agreed to an $8.5 million settlement after the Federal Trade Commission alleged the online in-home care services platform deceived caregivers looking for jobs and failed to give users a simple way to cancel paid memberships.

In addition to refunding consumers harmed by its practices, Care will be required to back up its earning claims and simplify its cancellation process, according to the settlement.

"Though Care.com was fully prepared to litigate this matter and confident in its position, we decided to enter into an agreement with the FTC to resolve it now and keep our focus on helping families and caregivers," a Care.com spokesperson said. "This settlement should in no way be construed as a validation of the FTC's claims."

The FTC filed suit Monday in federal court in the Western District of Texas alleging Care's marketing messages about the number of jobs available on its site and workers' compensation estimates were deceptive.

"Care's earnings claims are not based on actual wages earned by providers," the suit states. "Care also grossly inflates the number of jobs it advertises as available on its platform by including a significantly large number of job postings that it knows, or should know, are unlikely to result in employment."

The company, owned by New York media and internet company IAC (IAC), also impeded members' ability to cancel auto-renewing memberships by employing "deceptive design tactics" and limiting access to customer service, according to the suit.

This content was created by MarketWatch, which is operated by Dow Jones & Co. MarketWatch is published independently from Dow Jones Newswires and The Wall Street Journal.

(END) Dow Jones Newswires

08-26-24 1733ET

Copyright (c) 2024 Dow Jones & Company, Inc.