WASHINGTON (Reuters) -Publishers Clearing House (PCH), which offers sweepstakes where people can win thousands of dollars per week for life, has agreed to pay $18.5 million and change its business practices to settle allegations it misled consumers about its contests, the U.S. Federal Trade Commission (FTC) said on Monday.
The FTC had accused PCH of using "dark patterns," a manipulative website design, to make consumers believe that they had to make a purchase to win or to have a better chance of winning. The agency said that it also added surprise shipping charges to purchases, among other allegations.
"Today’s action requiring PCH to overhaul its user interface, compensate consumers for lost time, and stop surprise fees should send a clear message that manipulative design techniques are a no-go under our laws," Samuel Levine, director of the FTC Bureau of Consumer Protection, said in a statement.
Among the changes required on PCH's website are "clear, conspicuous, and unavoidable disclosures" that no purchase is needed to win and a purchase would not increase a person's chance of winning, the FTC said in a statement.
PCH said that roughly 98% of consumers who went on their website to enter a contest did not buy anything. "While we disagree with the FTC’s assertions and have admitted no wrongdoing, we agreed to settle this matter in order to avoid the ongoing expense and distraction of litigation," Christopher Irving, vice president for consumer and legal affairs, said in a statement.