MASSPIRG testifies in support of new AG rules to eliminate hidden junk fees

MASSPIRG’s Deirdre Cummings testified before the office of the Attorney General in support of AG Campbell’s recently proposed regulations cracking down on hidden “junk fees”.

MASSPIRG supports the efforts to crack down on deceptive and misleading advertising by reining in “junk fees” and improving consumer information on automatic renewals and trial offers.

The marketplace works best when consumers have meaningful, timely and complete information about the products and services they buy. Information about price is critical fundamental information that allows consumers to make informed decisions.

Comparable, complete, and timely price information allows consumers to make the right personal choices for their pocket books while also leading to a more competitive marketplace.  

For too long, we have watched as businesses have gradually stopped disclosing true prices in a practical or meaningful way. We have all experienced purchasing tickets, services, hotel rooms, subscriptions advertised at one price only to find the actual or final price is significantly more by the time we have to pay. This not only hurts our wallets but also harms businesses that truly are transparent and are disclosing total costs upfront, even though their prices look higher compared to the deceptive incomplete lower prices.

Consumer Reports estimates that 85 percent of Americans have experienced a hidden or unexpected fee for a service in the previous two years, and they report they are paying more in hidden charges than they were 5 years ago. The FTC estimates that hidden/junk fees cost consumers tens of billions of dollars a year in unexpected charges.

The proposed rules seek to require upfront total pricing, require disclosure about the nature and purpose of fees and taxes, and make it easier for consumers to cancel trial offers and renewal fees. 

Additionally, while the FTC and other regulatory agencies intend to regulate Junk Fees, it is important that Massachusetts also adopts appropriate regulations allowing the Office of Attorney General to enforce the law and protect Baystaters.