Julep Beauty to pay $3m fine over “deceptive” practices

12-Sep-2016

Company accused of making it difficult to cancel subscriptions to Maven service

Julep Beauty has been fined $3m for using “deceptive” techniques in order to get consumers to sign up for subscription services. The company was also said to have made it very difficult for these subscriptions to be cancelled.

The deceptive practices were said to have taken part from 2012 to 2015.

Consumers were offered a free welcome box of Julep products but had to register a credit or debit card to pay for shipping fees. During the period mentioned, the company did not make it clear that these consumers were also signing up for a subscription plan.

The subscription plan cost either $19.99 or $24.99 a month and was often difficult to cancel as the company did not employ enough staff to manage the volume of cancellation requests.

Bob Ferguson, Washington State Attorney General, explained: “It is maddening for consumers to receive products they don’t want but are charged for. That’s a deceptive way to run a business, and I won’t allow a company to get away with it.”

Julep Beauty will repay $1.5m to affected subscribers and $25,000 in costs and fees. The company will also provide hygiene products to charities and government institutions helping victims of domestic violence and the homeless.

A further $250,000 fine is suspended, provided that Julep avoid further violations and makes the costs and terms of its subscription service clear.

Jane Park, owner of Julep Beauty, took responsibility for the company’s failings. She said: “I want to take this opportunity to acknowledge and take responsibility for Julep’s previous practices that formed the basis of the Attorney General’s lawsuit.”

Julep markets nail polish and other products on social media and via online ads. It sells the majority of its stock through its own website.

Around 55,000 consumers are thought to be affected by the subscription service, although the exact number is unknown due to inconsistent record-keeping.

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