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Uber fined $20M by FTC over earnings claims

Uber fined $20M by FTC over earnings claims image

Nica Onate / Uber | January 25, 2017 08:41

Uber settles for $20M settlements with FTC to remunerate drivers

Uber Technologies has recently agreed to pay $20 million to resolve Federal Trade Commission (FTC) charges that it recruited prospective drivers with misrepresented earnings claims as well as claims about financing through its 'Vehicle Solutions Program'.

On its website, the company claims that uberX drivers' median income is more than $90,000 a year per driver in New York. Meanwhile, over in San Francisco, it is more than $74,000 a year per driver in San Francisco. The FTC, however, said that the median income earned by Uber drivers in those cites were in fact $61,000 in New York and $53,000 in San Francisco. Less than 10-percent of the drivers earned the income claimed by Uber.

Aside from this, Uber also promised that the 'Vehicle Solutions Program' will provide drivers connection with the "best financing options available," regardless of the driver’s credit history, and told consumers they could "own a car for as little as $20/day" ($140/week) or lease a car with "payments as low as $17 per day" ($119/week), and "starting at $119/week." It also claims that drivers who lease their cars through this program would have access to unlimited miles through its program when in fact, the leases came with mileage limits, the FTC alleges.

FTC said that the $20 million will be used to provide refunds to all drivers affected across the the US.

"Many consumers sign up to drive for Uber, but they shouldn't be taken for a ride about their earnings potential or the cost of financing a car through Uber. This settlement will put millions of dollars back in Uber drivers’ pockets," said Jessica Rich, Director of the FTC’s Bureau of Consumer Protection.

In addition to imposing a $20 million judgment against Uber, the stipulated order prohibits the company from misrepresenting drivers' earnings and auto finance and lease terms. The order also bars Uber from making false, misleading, or unsubstantiated representations about drivers' income; programs offering or advertising vehicles or vehicle financing or leasing; and the terms and conditions of any vehicle financing or leasing.