Penalty Amount
$4,250,000
AppFolio, Inc., a tenant background report provider, settled with the FTC for $4.25 million over allegations it violated the Fair Credit Reporting Act by failing to implement reasonable procedures to ensure the accuracy of its screening reports and by including eviction and non-conviction criminal records older than seven years. The settlement prohibits including old records and requires maintaining accuracy procedures.
AppFolio must pay $4.25 million, is prohibited from including non-conviction criminal or eviction records older than seven years in its reports, and must maintain reasonable procedures to ensure the maximum possible accuracy of its background reports.
In-house legal teams should review all vendor and customer agreements where the company either provides or consumes tenant/background screening reports. Specifically examine clauses governing data accuracy, FCRA compliance certifications, data sourcing from third parties, and restrictions on the age of reported records (e.g., evictions, non-convictions). Agreements with property management clients (as vendors) may require amendments to mandate adherence to FCRA's 'reasonable procedures' standard and prohibit inclusion of records older than seven years. Contracts with third-party data providers should be scrutinized for warranties of accuracy and compliance. Consider adding audit rights, indemnification for FCRA violations, and explicit requirements for maintaining up-to-date accuracy procedures.
Entity
AppFolio, Inc.
Also known as: AppFolio
Industry
Data BrokerOfficial Press Release
https://www.ftc.gov/news-events/news/press-releases/2020/12/tenant-background-report-provider-settles-ftc-allegations-it-failed-follow-accuracy-requirements
ecf 1 us v appfolio complaint
https://www.ftc.gov/system/files/documents/cases/ecf_1_-_us_v_appfolio_complaint.pdf
ecf 2 us v appfolio stipulated order
https://www.ftc.gov/system/files/documents/cases/ecf_2_-_us_v_appfolio_stipulated_order.pdf
Federal Trade Commission Enforcement Page
https://www.ftc.gov/enforcement
"AppFolio, Inc."
"$4.25 million"
"Fair Credit Reporting Act (FCRA)"
"failed to implement reasonable procedures to ensure that criminal and eviction records it received from a third party vendor were accurate before including such information in its tenant screening reports."
"including eviction or non-conviction criminal records more than seven years old in its reports."
$750K
The FTC finalized an order against Vanilla Chip LLC (doing business as TruHeight) and its principals for deceptively advertising height-enhancing supplements for children and teens without scientific evidence. The company also used fake reviews and incentivized 5-star ratings. The order requires a $750,000 payment and prohibits false health claims and deceptive review practices.
$2.3M
The FTC alleged that RentGrow, a tenant screening company, violated the Fair Credit Reporting Act (FCRA) by failing to use reasonable procedures to ensure the accuracy of its reports, including by reporting duplicate records and failing to disclose data sources. RentGrow agreed to pay a $2.25 million penalty and is prohibited from further FCRA violations and from misrepresenting dispute outcomes.
The FTC and New York Attorney General took action against Handy Technologies for deceptive earnings claims and failure to disclose fees and fines that led to millions of dollars being withheld from workers' wages. The FTC is sending over $2.7 million in refunds to 62,893 affected consumers.
$35.0M
The FTC alleged that Hopper, a travel booking app, charged consumers hidden and pre-selected fees (Tip and VIP Support) without their consent, misrepresented the benefits of VIP Support and Price Freeze services, and failed to clearly disclose total prices. Hopper agreed to pay $35 million for consumer redress and is prohibited from misrepresenting fees under a proposed order.
$1.5M
The FTC finalized a settlement with Publishing.com LLC and its principals for misleading consumers about potential earnings from self-publishing products. The company will pay $1.5 million and is prohibited from making unsubstantiated earnings claims, failing to disclose refund terms, and misrepresenting endorsements and reviews.
The FTC is seeking public comment on a proposed policy statement addressing concerns that AI companies may be manipulating AI system outputs contrary to consumer expectations for objectivity and accuracy. The statement explains that such conduct could be considered deceptive under Section 5 of the FTC Act. The public comment period runs until July 31, 2026.