An online dating company is being fined more than half a million dollars for allegedly tricking users into upgrading their membership with enticing messages from fake profiles.
The Federal Trade Commission announced Wednesday it is also fining the company for failing to disclose its terms of service, which would automatically renew and charge customers after their initial membership expired.
England-based company JDI Dating and its owner, Mark Thomas, were the target of the $616,165 fines. The settlement forbids the company from misrepresenting facts about the service or its cancellation policy in the future.
"JDI Dating used fake profiles to make people think they were hearing from real love interests and to trick them into upgrading to paid memberships,” said the FTC's Jessica Rich, who directs consumer protection at the agency.
The company, which operates 18 websites, was accused of using computer generated profiles to send messages to users who had created free profiles. The FTC found that messages sent to users who created these free profiles were "almost always fake."
Customers could not respond to other members unless they signed up for a subscription fee, usually $10 to $30 a month. The company boasts 12 million members on its website.
"The fake profiles and messages caused many users to upgrade to paid subscriptions," the FTC said in a release.
While the company used a small icon to designate that the fake accounts, known as "virtual cupids," were not real, "users were not likely to see" or understand what it meant, according to the FTC.
The fine and other orders will go into effect after they are signed by a district judge, where the complaint was brought in Illinois.
"JDI Dating has not admitted to any wrongdoing in this matter, but was happy to reach a resolution that was satisfactory to all parties," a lawyer representing the company said in a statement.