Attorney General Brown Secures Settlement with Online Clothing Retailer Regarding Deceptive Advertising and Billing Practices

​​​​​​​​​​FOR IMMEDIATE RELEASE

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BALTIMORE, MD – Attorney General Anthony G. Brown today announced a multistate settlement with TFG Holding, Inc. (TFG), an online clothing retailer that offers shoes, clothing, and accessories across several different brands, including JustFab, ShoeDazzle, and FabKids. The settlement resolves claims that the company used negative option marketing practices to deceptively enroll consumers into its VIP Membership Program, and then made it difficult for consumers to cancel their memberships. TFG is accused of offering consumers discounts when they purchased products on its brands’ websites without adequately informing them that if they accepted that discount they would be enrolled in a VIP membership that would bill them $49.95 a month, which could only be used to make future purchases.  

“Marylanders deserve to know exactly what they’re paying for when they make a purchase online – not to be trapped paying costly monthly charges they never agreed to,” said Attorney General Brown. “This settlement not only provides refunds to consumers harmed by TFG's hidden fees but also sets clear standards to prevent these deceptive practices in the future.”

Attorney General Brown accused TFG Holding, Inc. of violating the Maryland Consumer Protection Act in multiple ways, including by: 

• Misrepresenting the price consumers could expect to pay for products advertised on the company’s websites; 

• Automatically enrolling consumers, without their consent, into a Membership Program that included a recurring charge without consumers’ knowledge, consent, or knowing authorization; 

• Implementing and maintaining cancellation policies and practices that frustrated consumers’ ability to cancel the VIP Membership Programs into which they were enrolled; and 

• Failing to adequately disclose material facts to consumers, including that by purchasing products they would be enrolled in the VIP Membership Program. 
  
  

Under the terms of the settlement, TFG Holding, Inc. is required to: 

• Comply with all applicable local, state, and federal laws, regulations, and rules; 

• Clearly and conspicuously disclose the material terms of its VIP Membership Program to consumers, including that consumers will be enrolled in the VIP Membership Program, the amount and frequency of all applicable recurring charges, and the consumers’ right to cancel; 

• Refrain from representing its offers or sales of its products as time-sensitive, when they are not, including using deceptive countdown timers; 

• Obtain the consumer’s express informed consent prior to enrolling any consumer in the VIP Membership Program; 

• Provide a simple online mechanism for consumers to cancel their VIP Membership; 

• Promptly honor consumer cancellation requests and cease any further billing; 

• Provide all consumers the opportunity to request and obtain a refund of any recurring charge balance accrued within the preceding year; and 

• Cease the billing of recurring charges to any consumer who enrolled in the VIP Membership Program prior to May 31, 2016, unless the consumer used their membership. Cease the billing of recurring charges to any consumer who enrolled in the VIP Membership Program prior to May 31, 2016, unless the consumer used their membership. TFG Holdings has agreed to pay restitution to customers with older accounts who have not used their membership programs. It has also agreed to resolve existing complaints that were lodged against it by consumers. Consumer with existing complaints can contact the company via email at [email protected]. Consumers with questions about this restitution program may call the Consumer Protection Division at 410-528-8662. 
  
  

TFG Holdings has agreed to pay restitution to customers with older accounts who have not used their membership programs. It has also agreed to resolve existing complaints that were lodged against it by consumers. Consumer with existing complaints can contact the company via email at [email protected]. Consumers with questions about this restitution program may call the Consumer Protection Division at 410-528-8662. 

The company has also agreed to pay $1 million to the Attorneys Generals’ offices that joined today’s settlement. Joining Attorney General Brown in today’s settlement are the attorneys general of Alabama, Arkansas, Connecticut, the District of Columbia, Georgia, Idaho, Illinois, Indiana, Kansas, Kentucky, Louisiana, Maine,  Massachusetts, Michigan, Minnesota, Mississippi, Nevada, New Hampshire, New Jersey, New Mexico, North Carolina, North Dakota, Ohio, Oklahoma, Oregon, Pennsylvania, Rhode Island, Tennessee, Texas, Vermont, Washington, and Wisconsin. 

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