Uber settled a lawsuit filed by the Federal Trade Commission today for $20 million. The lawsuit alleged that the ride-hailing app recruited drivers by misleading them about the amount of money they could earn through the app and the auto financing deals they could get through Uber’s Vehicle Solutions Program.
The lawsuit claims that Uber made “false, misleading, or unsubstantiated claims regarding driver earnings and its Vehicle Solutions Program.” The FTC says that, although Uber advertised that drivers could earn between $16 and $29 per hour depending on the city in which they drove, only a fraction of drivers actually earned the advertised amount.
In Boston, Minneapolis and Philadelphia, fewer than 10 percent of drivers earned the advertised amount, according to the FTC. In several other cities, the rate was a bit higher — fewer than 30 percent of drivers earned the advertised rate in Dallas, Phoenix and Seattle.Here's the Federal Trade Commission press release:
Uber also promoted the Vehicle Solutions Program as a low-cost way for drivers to buy a vehicle, saying drivers would get the “best financing options available” and have “unlimited miles.” The FTC suit claims this wasn’t the case at all — in fact, Uber had “no basis” for these statements. The rates offered by Uber were often higher than those commercially available, the FTC says.
By settling the lawsuit, Uber did not admit to the allegations. An Uber spokesperson told TechCrunch, “We’re pleased to have reached an agreement with the FTC. We’ve made many improvements to the driver experience over the last year and will continue to focus on ensuring that Uber is the best option for anyone looking to earn money on their own schedule.”...MORE