Doxo, a relatively unknown bill payment platform, has allegedly been deceiving and scamming consumers for years through deceptive online marketing and shady business practices.
On Thursday, the U.S. Federal Trade Commission (FTC) sued Seattle-based Doxo and its founders, Steve Shivers and Roger Parks, accusing the firm of ignoring tens of thousands of complaints from consumers and billers about their business model.
“Doxo intercepted consumers trying to reach their billers and tricked them into paying millions of dollars in junk fees,” Samuel Levine, who leads the FTC’s bureau of consumer protection, said in a statement.
Here’s how it works.
Doxo places ads to “intercept” consumers trying to visit their billers’ websites by stylizing ads to impersonate the billers. The company claims customers can “pay any bill” using its “network” of billers. But according to the FTC, Doxo has no relationship with more than 98% of billers in the so-called network.
If the consumer continues past clicking on the ad to the payment process, Doxo adds extra junk fees to the bill, including a “delivery fee” that first appears on the final page of a seven-step process. In most cases, those fees could have been avoided if the consumer had gone to the actual biller. The FTC alleges that people have been mistakenly forced to pay millions of dollars in junk fees because of Doxo.
And, although Doxo charges consumers instantly, the biller doesn’t get paid until later. The FTC says that, in “many instances,” Doxo prints out a paper check that arrives days or weeks after a customer thinks their bill has already been paid.
“Consumers have spent hours trying to track down payments made to Doxo, have missed tax, child support, and utility payments, have had medical and other bills sent to collection, and have had their gas, water, and electricity cut off, all because Doxo falsely represented that their payments were made ‘directly’ to their billers,” the FTC wrote in its complaint.
In addition to the one-time junk fees, Doxo tricked some consumers into a subscription package, according to the FTC. If consumers clicked on a terms of service hyperlink at the bottom of the payment page, Doxo automatically enrolled them into a paid subscription — without notifying them of the change.
Several consumers told the FTC they were tricked into believing that paying through Doxo’s services was the only way to make an online payment. Others thought their biller preferred consumers pay through Doxo because of the pop-up search ads.
Doxo provided Quartz with a statement calling the investigation “inaccurate, and unjust.” Its full statement reads:
For over 14 years, doxo has remained committed to taking the necessary steps to comply with all regulations and exceed market standards for ensuring consumers are protected and empowered throughout the bill pay experience. To date, we have assisted over ten million people in safely and efficiently paying their bills, eliminating extraneous costs, and improving and protecting their financial health. The current U.S. Federal Trade Commission investigation is inaccurate, and unjust, pushing forth a narrative that is a monumental step backward from the objective of reducing bill pay complexity and costs. The U.S. Federal Trade Commission’s complaint indicates a fundamental misunderstanding of the existing bill-pay market and the structural inefficiencies that almost always work against consumers. doxo is committed to fighting on behalf of all consumers and billers who deserve a better bill pay experience, and we look forward to seeing their interests prevail.
Some companies, including several hospitals and local governments, have dedicated webpages warning consumers not to use Doxo thanks to how widespread its presence has become. Shivers, Doxo’s CEO, testified in March 2021 that his company has received 58 complaints from state agencies.
In March 2022, WRAL reported that consumers in North Carolina were forced to pay $100,000 worth of late fees to the state’s toll authority because of delayed payments made through Doxo. Parks, who serves as Doxo’s vice president, replied by accusing a toll authority spokesperson of defamation, according to the FTC.
Editor’s note: This story was updated to include Doxo’s statement.