The feds are probing accusations that Uber has been bilking clients because the ride-sharing big winds down its “Uber Rewards” loyalty program, The Put up has discovered.
In August, Uber stated that starting Nov. 1 it’ll scrap Uber Rewards — a program launched in 2018 that makes use of a free, points-based system to dole out perks like complimentary rides and discounted meals deliveries — to concentrate on its paid subscription service, Uber One.
The Federal Commerce Fee, nevertheless, has launched a casual investigation into complaints that Uber is making it troublesome to redeem Uber Rewards factors forward of expiration, sources near the scenario instructed The Put up.
The corporate in August despatched clients an electronic mail asserting it was ending this system, based on a report. However some stated they by no means obtained any emails and “didn’t even know” it was ending. One supply who has amassed greater than 20,000 factors — price almost $150 in rides — stated he was repeatedly met with a message saying, “Sorry, one thing is mistaken — please strive once more later” as he tried unsuccessfully to redeem them.
“Uber simply desires to apologize for an error — not truly pay out the cash,” the irate buyer instructed The Put up.
By the tip of the month the company may announce a extra formal investigation into Uber ending its perk program, a supply near the FTC instructed The Put up. The supply added that Uber ought to lengthen the chance for customers to redeem factors because of the glitches.
The FTC probe comes as Uber’s former chief safety officer Joe Sullivan final week was slapped with felony obstruction fees for failing to report a cyber hack to federal authorities. Sullivan, who paid a $100,000 “bug bounty” to a hacker in 2016 to guard customers’ information tried to forestall regulators from discovering out concerning the fee, the FTC alleged. Sullivan may face eight years in jail.
“The feds have been taking part in shut consideration to Uber — from the continued hacks that danger customers’ private data to this scam-like rewards program nonsense,” a supply near the FTC added. “Backside line is that there’s an Uber ‘pool’ of issues the corporate is dealing with internally.”
Whereas it’s not clear how a lot cash Uber may save by ending this system with out correctly paying out factors, individuals near the FTC imagine it may very well be within the tens of millions.
Uber CEO Dara Khosrowshahi instructed Bloomberg in August that his focus on the firm is “profitability” as the corporate’s inventory has tanked greater than 35% over the previous 12 months. Folks near Khosrowshahi say he has checked out every bit of the corporate — together with rewards program — and whether or not it helps the corporate’s shareholders.
Starting Nov. 1, Uber will provide all clients a free monthlong trial of Uber One. However the positive print reveals that enrolling customers will routinely be renewed except they choose out, placing them on the hook for a $9.99 month-to-month charge.
Defending customers from glitchy rewards packages has been a spotlight for the FTC over the past decade. In 2010, the company carried out a rule that ensured corporations needed to honor present playing cards for no less than 5 years and that the cash on these playing cards couldn’t expire earlier than then.
An Uber spokesperson didn’t reply to requests for remark.
An FTC spokesperson declined to remark.
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