Uber-exaggerated claims

Uber-exaggerated claims result in $20 million settlement

When you’re on the hunt for income, the last thing you want is to be misled about the earnings and benefits that a business opportunity offers.  The FTC announced that Uber agreed to a $20 million settlement of the FTC’s charges that the company made false or unsupported claims regarding its drivers’ likely income and the benefits of its Vehicle Solutions Program.

The FTC says Uber made several misleading claims about the annual and hourly wages its drivers were likely to earn. For example, Uber’s website claimed that the median yearly income for Uber drivers in New York is $90,000. Similarly, Uber ads in Boston and Philadelphia claimed that the average driver would “make $25/hour,” while San Diego and Phoenix drivers could expect to make $20/hour. According to the FTC, most of Uber’s drivers were not likely to earn the claimed annual and hourly wages.

To attract new drivers, Uber also created the Vehicle Solutions Program, which claimed to “connect drivers with any kind of credit history to the best financing options available.” Uber advertised “payments as low as $17 per day” and “starting at $119/week,” as well as unlimited mileage on leased vehicles.

In reality, drivers who participated in the Vehicle Solutions program paid more than the weekly advertised amounts and were offered higher interest rate loans than the industry average. Also, even though Uber claimed leases had “unlimited mileage,” the leases did have mileage limits.

The settlement requires Uber to pay $20 million and prohibits the company from making false or misleading claims about its drivers’ likely income and the benefits of its Vehicle Solutions Program.

If you or someone you know drives for Uber, watch this space for info on how the FTC plans to make refunds.

And remember, if a business doesn’t deliver on its promises or if you’ve spotted a scam, report it to the FTC.