JustFab Parent Company Reaches $1 Million Settlement Over Deceptive Membership Fees

Maryland Attorney General Anthony G. Brown announced a major settlement this week. The agreement involves TFG Holding, Inc., the parent company of popular online retailers JustFab, ShoeDazzle, and FabKids. It resolves a multistate investigation into deceptive marketing practices.The company was accused of automatically enrolling customers into a costly monthly VIP program. This happened without their clear knowledge or consent. The settlement provides refunds for affected consumers and mandates significant changes to the company’s business model.

Key Violations and Consumer Impact

According to the Attorney General’s office, TFG violated consumer protection laws. The core allegation was that customers were offered discounts without clear disclosure. Accepting the offer automatically signed them up for a $49.95 monthly membership fee.This fee acted as store credit for future purchases. Many consumers reported they were unaware of the recurring charge. The investigation also found that cancelling the membership was deliberately difficult.This created significant frustration and financial harm. Customers found themselves paying for a service they did not want. The practice affected shoppers across the United States for years.

New Rules and Required Reforms

The settlement imposes strict new rules on TFG’s operations. The company must now obtain a customer’s express informed consent before any enrollment. All terms of the VIP program must be clearly and conspicuously disclosed.This includes the full cost and frequency of the recurring charges. Furthermore, TFG is required to create a simple online cancellation process. They must also stop using deceptive countdown timers on their websites.As part of the resolution, TFG will pay $1 million to the 32 states and the District of Columbia involved. The company must also provide refunds to eligible consumers. This settlement sets a strong precedent for transparency in online retail subscriptions.

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This landmark settlement forces major online retailers to be fully transparent with their customers, ensuring that deceptive membership traps like the one in the JustFab settlement become a thing of the past.

Info at your fingertips

What brands are involved in this settlement?

The settlement involves TFG Holding, Inc. This parent company operates the brands JustFab, ShoeDazzle, and FabKids. All three sites were part of the same marketing practices.

How can I get a refund from the JustFab settlement?

Eligible consumers can request a refund directly from the company. You can email TFG at the address provided in the official settlement notices. You may also contact the Maryland Consumer Protection Division with questions.

What were the main deceptive practices cited?

The main issues were automatic enrollment without clear consent and hidden recurring fees. The company also made it very difficult for customers to cancel the membership. Deceptive countdown timers were also used.

What changes is the company required to make?

TFG must now get clear consent before enrollment. They must provide simple online cancellation. All membership terms and fees must be disclosed upfront.

Which states were part of this legal action?

A total of 32 states and the District of Columbia joined the multistate settlement. This was a coordinated effort by multiple state attorneys general to address the nationwide issue.