FCC: Lyft took users for a ride regarding robocalls, texts
The Federal Communications Commission learns the ride-hailing company's terms of service said users could opt out of marketing messages but that no such option existed.
US regulators slapped ride-hailing service Lyft with a citation Friday for breaking rules that protect consumers from unwanted robocalls and texts.
The Federal Communications Commission said San Francisco-based Lyft, which makes a smartphone app that pairs passengers with drivers, doesn't let users access the service if they opt out of automated marketing calls and texts. That's a violation of the Telephone Consumer Protection Act, according to the citation (PDF).
Lyft's terms of service say that a user can opt out of robocalls and texts by using "provided unsubscribe options." But the FCC's investigation found that the company doesn't actually provide such options. If users are able to locate the opt-out page by navigating the company's website, and then choose to opt out, they aren't able to use Lyft's service, the FCC said.
"We urge any company that unlawfully conditions its service on consent to unwanted marketing calls and texts to act swiftly to change its policies," Travis LeBlanc, chief of the FCC's enforcement bureau, said in a statement.
Lyft is challenging the claim. "Lyft has not been using promotional texts to spam users with unwanted communications," said Chelsea Wilson, Lyft's public policy communications manager, in an emailed statement on Sunday. The company also updated its Terms of Service on Friday to include "detailed information for users who wish to opt-out of promotional or marketing communications, but still wish to receive other text messages from Lyft," she added.
The citation is a sharp warning that gives the FCC the authority to impose sanctions and monetary penalties if Lyft keeps breaking the rules. It's also a sign that the government is keeping an eye on the tech startup.
The move is the latest tussle between government and so-called sharing economy companies.
Lyft and its ride-hailing rival Uber have dealt with regulatory battles, cease-and-desist letters and lawsuits from states and cities across the country. From Pennsylvania to Texas to Nevada, local lawmakers have spoken against ride-hailing companies, calling for tighter regulations on insurance, car inspections and driver background checks. Home rental marketplace Airbnb, likewise, has had to work with lawmakers around the world to legitimize its service.
The FCC also cited the F.N.B. Corporation (First National Bank) on Friday for similar robotic marketing violations. The commission said Pittsburgh-based First National makes online banking and Apple Pay customers agree to receive autodialed marketing texts to use its service. A company spokeswoman said FNB was also just made aware of the issue and hasn't received any formal communications from the FCC. "We will immediately investigate the issue and are fully committed to ensuring that we continue to comply with the consumer rights laws and regulations," she said, adding that "our policies generally allow all customers to opt out of marketing information."
Digital payments company PayPal has also gotten into hot water with the FCC over autodialed marketing calls and texts.
Update, September 15 at 3:45 p.m. PT: Adds comment from Chelsea Wilson.