FTC: Settlement will stop online dating service from using fake profiles, automatically renewing subscriptions

A company based in the United Kingdom that operates an online dating service with more than a dozen websites has agreed to stop using fake profiles to lure viewers into becoming paying subscribers, according to documents filed this week in Chicago’s federal court.

The Federal Trade Commission on Monday filed a complaint against JDI Dating Ltd. and William Mark Thomas, the company’s chief executive officer, as well as a motion for entry of a stipulated order for a permanent injunction and other relief.

On Wednesday, the FTC said in a news release the settlement with JDI Dating marks “its first law enforcement action against an online dating service.”

The settlement had not been approved by a judge as of early Wednesday evening, but court records show FTC attorney Steven M. Wernikoff is set to present the motion seeking entry of the stipulated order to U.S. District Judge James B. Zagel on Thursday.

“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,” Jessica Rich, director of the FTC’s Bureau of Consumer Protection, said in the release. “Adding insult to injury, users were charged automatically to renew their subscriptions – often without their consent.”

In its complaint, the commission claims JDI Dating and Thomas violated the FTC Act by making misrepresentations through the use of computer-generated, fake profiles known as “virtual cupids” and by not disclosing subscriptions to their sites are automatically renewed.

The FTC’s complaint also accuses the defendants of violating the Restore Online Shoppers’ Confidence Act (ROSCA) by failing to clearly disclose its automatic renewal process, obtain consent before charging consumers for renewals and provide an easy way to stop the charges.

According to the FTC, the defendants,  since at least 2013, have operated an online dating service made of up at least 18 different websites, including cupidswand.com, flirtcrowd.com and findmelove.com, as well as their company website at jdidating.com.

These sites, the complaint notes, typically allow consumers to create a dating profile at no cost. These “members,” however, aren’t given access to certain features that paying “subscribers”  have while using the sites.

For instance, members can send other members “winks” and “ice breakers,” but can’t send personalized messages, read certain messages or see full-sized photographs. If they try to do something only available to subscribers, they are redirected to a membership upgrade page offering subscriptions.

The defendants’ sites, according to the FTC, offer subscriptions ranging in price from $10 to $30 a month and duration from one month to a year. Consumers have to pay for subscriptions by entering their credit card information into the website, which the FTC asserts does not clearly explain that subscriptions will automatically be renewed unless subscribers cancel them, among other things.

The complaint notes the defendants’ company website, not their dating websites, boasts of having more than 12 million members on their 18 dating sites, even though the FTC asserts that number is much lower as the majority of users are not paying members or have not active in months or years.

The stipulated order, once given the OK by a judge, will prohibit JDI Dating and Thomas from making misrepresentations about their services and from failing to disclose to members they will receive messages from so-called virtual cupid profiles that do not belong to real people.

Among other provisions, the settlement will require the defendants to disclose the full details of their subscription plans, including the deadline for canceling and how to stop charges, before obtaining consumers’ billing information for products with automatic renewal plans.

The defendants also agreed to pay $616,165 in redress, according to the FTC.

*Editor's Note: The above photo was taken from the FTC new release and portrays an example of the defendants' fake or "virtual cupid" profiles. The FTC notes a small "v" enclosed with a "C" on the dating profile page is the only indication it is fake.