An adult entertainment company, Xpics Publishing, is to pay back
money to on-line users from whom it unfairly obtained credit card
details, in terms of a settlement agreed with the US Federal Trade
Commission.
Xpics advertised its services via unsolicited e-mails and
internet banner advertisements and enticed users into revealing
credit card details by offering them the opportunity to view its
site for free. The information was used to make false billings to
individuals' accounts.
Although the company offered users the option to cancel their
accounts, in reality this was made virtually impossible by a series
of technical measures that prevented access to the relevant
cancellation web pages. Alternative methods of cancellation
including telephone and e-mail services were equally
inaccessible.
The individuals responsible for Xpics’ actions will have to
reimburse all users that were improperly billed and they have
agreed to post ‘clear and conspicuous’ explanations of their
billing procedures on the web site.
Despite the actions being in breach of federal law, it appears
that there will be no further punishment by the FTC.
