Vonage Ordered to Pay $100 Million for Trapping Customers in Subscriptions

The FTC alleged that Vonage, a major Voice over Internet Protocol (VoIP) provider, deliberately erected barriers to prevent customers from canceling their service. The company hid its cancellation process, making it nearly impossible to cancel online. Customers who tried to cancel by phone were subjected to long hold times and aggressive retention tactics.

Even when customers managed to navigate the cancellation obstacle course, Vonage continued to charge them. The company also imposed early termination fees that were not clearly disclosed at the time of sign-up.

Consumers reported spending hours trying to cancel, being transferred between departments, having their cancellation requests "lost," and discovering continued charges on their credit card statements months after they believed they had canceled.

The case was one of several FTC actions targeting "negative option" practices where companies make it easy to sign up but deliberately difficult to cancel.