FTC serves health-app maker massive slice of humble pie—and $1.5M bill
The Pact app was supposed to help users meet weekly goals for exercising and eating veggies. Users that succeeded were promised cash rewards, while those who broke their health “pact” paid penalties. But according to the Federal Trade Commission, it was the app maker that saw diet and exercise results—it feasted on users’ bank accounts and made a run for it when “tens of thousands” of them complained.
On Wednesday, the FTC announced that the maker of the app, Pact Inc., agreed to a $1.5 million judgement. Nearly $1 million of that will go to users as refunds and unpaid rewards. Pact has 30 days to fork over the dough.
Along with the settlement announcement, the FTC released its full complaint against Pact (PDF). The complaint outlines how the app was supposed to work and how it allegedly went terribly wrong.