Attorney General Anthony G. Brown announced that his Consumer Protection Division has entered into a settlement resolving an investigation of online lingerie retailer AdoreMe, Inc. (AdoreMe).
The settlement resolves the Attorney General’s claim that AdoreMe deceptively marketed discounted lingerie to its customers without adequately revealing that if they accepted the discount, they would be enrolled in a VIP membership program that would continue to bill them monthly amounts that could be used for future purchases. Consumers who did not want to remain in the VIP program faced obstacles cancelling their memberships. Under today’s settlement, Maryland consumers who never used their VIP memberships will receive refunds of the payments they made. An additional group of consumers who have large credit balances will also be entitled to obtain refunds from the company. “Maryland consumers deserve transparency in their online purchases and should not face hidden monthly fees,” said Attorney General Brown. “This settlement secures refunds for affected Marylanders and sets clear guidelines to prevent similar deceptive practices.” AdoreMe’s website offered consumers the ability to receive a discount on the purchase of their lingerie items, but only if consumers enrolled in its VIP program, which required monthly payments of $39.95 that could be used to make future purchases. Under the terms of today’s settlement AdoreMe is allowed to continue to enroll consumers into its membership program, but it must obtain their affirmative consent and clearly and conspicuously disclose the terms of the program before billing consumers. AdoreMe must also provide enhanced notice each month when it bills consumers and provide them easier access to their membership terms. For consumers who wish to cancel, AdoreMe is prohibited from creating obstacles to cancellation and must provide a simple means for consumers to cancel their memberships, including an easily accessible online mechanism on its website. It must also promptly act on consumers’ requests to cancel and pay timely refunds. AdoreMe will also automatically stop billing consumers if their accounts accumulate more than twelve months of credit.
All Maryland consumers who were enrolled into AdoreMe’s VIP memberships, but their membership is inactive, will receive a refund equal to the balance of all of the funds they paid the company that they never used to make purchases. Attorney General Brown anticipates these refund checks will be mailed to consumers within the next two to three months. Maryland consumers who still have active VIP memberships with AdoreMe will be contacted by the company within the next one to two months and offered the opportunity to obtain a refund of as much as one year of payments made to the company. Consumers with questions about this restitution program may call the Consumer Protection Division at 410-528-8862. In addition to paying restitution to consumers, AdoreMe also agreed to pay the Attorney General’s Office $250,000.
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