Riverside Payments to Pay $600K Over Small Business Deception Claims
The FTC and Washington state allege Riverside Payments hid fees and trapped small businesses in auto-renewing contracts despite 'risk-free' cancellation promises.
Federal Trade Commission and Washington state regulators have reached a $600,000 settlement with payment processor Riverside Payments Inc., its affiliate Cascade Equipment Leasing LLC, and their operators over allegations that the companies systematically misled small businesses about the true cost and terms of their payment-processing services.
According to the joint complaint, Riverside Payments falsely promised prospective clients they would save money by switching to its processing services, while failing to disclose key fees embedded in the contracts. The firms also allegedly made cancellation extremely difficult in practice, even as they marketed the arrangement as carrying no cancellation risk.
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The auto-renewal provisions at the center of the case represent a pattern regulators have increasingly targeted across the subscription and services economy. Small businesses, which often lack dedicated legal or financial compliance staff, are particularly vulnerable to contract terms obscured in fine print or verbal assurances that contradict written agreements.
The settlement resolves the allegations without a court finding of liability, a standard outcome in FTC enforcement actions. The $600,000 in payments will be distributed as part of the resolution involving both the federal agency and Washington state authorities, reflecting a growing trend of joint federal-state consumer protection enforcement against financial services providers.
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