GOAT Pays Over $2M in Refunds to Consumers Following FTC Complaint About Shipping, Deficiencies
Online resale marketplace GOAT on Monday said it paid more than $2 million in refunds to consumers as part of a settlement with the Federal Trade Commission (FTC).
The agency came after GOAT for alleged violations of an FTC rule requiring reasonable shipping practices as well as an alleged failure to honor the platform’s “Buyer Protection” policy. A complaint filed by the FTC on Monday accused GOAT of failing to offer consumers the proper refunds for shipping when an order was delayed. According to the FTC, 37 percent of orders that paid extra for the “Instant” shipping option were shipped later than promised and improperly compensated. The complaint also said that more than 16 percent of all “Next Day” orders were shipped later than promised without offering the customer the option to agree to the delay or cancel the order and receive a refund.
GOAT said in a statement that 99.84 percent of the reviewed sample data for its shipped products were shipped or received on time. The platform attributed the FTC’s 37 percent calculation to a misinterpretation of the data.
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“We settled this matter in order to avoid costly and time-consuming litigation,” GOAT said in a statement.
The FTC complaint also alleged that GOAT did not offer an effective program to sort through return requests for deficient products, which led to several consumers being denied refunds. According to the complaint, consumers had to make requests to customer service before getting refunds (which often excluding shipping costs) for their purchases.
“When an online business promises to protect consumers’ purchases, it must have the appropriate systems in place to make sure those protections can be implemented,” said Samuel Levine, director of the FTC’s Bureau of Consumer Protection, in a statement. “Forcing consumers to jump through hoops or keep complaining in order to get a promised refund is also unacceptable under the law.”
In its statement, GOAT said that the customer complaints cited in the filing represent “roughly 0.008 percent of sample data orders, and were the result of minor error.”
“We’re confident in the products we sell and the way we sell them, and we will continue to provide our members with an experience that meets our and their high standards,” GOAT said in the statement.
GOAT paid $2,013,527 in customer refunds as part of the court order from the FTC. The order also prohibited GOAT from misrepresenting the relief it offers consumers in the event of a deficient product and prohibits the misrepresentation of its return policies in general.
