Victims of fraudulent pop-up scams to share the $5 million
of ConsumerAffairsJune 17, 2025
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FTC settlement bans Paddle.com from U.S. payment processing for deceptive tech-support firms
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Company allegedly enabled foreign scammers targeting U.S. consumers, especially older adults
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$5 million to be paid to support refunds for victims of fraudulent pop-up scams
The Federal Trade Commission has reached a settlement with U.K.-based payment processor Paddle.com Market Limited and its U.S. subsidiary, Paddle.com, Inc., that includes a $5 million payment and a permanent ban on processing payments for tech-support telemarketers.
The settlement resolves allegations that Paddle facilitated access to the U.S. credit-card system for deceptive foreign tech-support operations, allowing these schemes to defraud American consumers, particularly seniors, out of millions of dollars.
According to the FTC’s complaint, Paddle played a key role in enabling pop-up-based tech-support scams such as those run by Restoro-Reimage. These scams used alarming fake virus alerts, sometimes impersonating trusted names like Microsoft or McAfee, to trick consumers into purchasing unnecessary software or support services.
The agency says Paddle used its position as merchant of record and a supposed reseller to process credit card payments on behalf of numerous unrelated third-party entities, obscuring their identities from card networks and banks.
Paddle provided foreign-based tech-support schemes with access to the U.S. payment system, allowing these companies to harm consumers, said Christopher Mufarrige, Director of the FTCs Bureau of Consumer Protection. The FTC will hold accountable payment companies that knowingly facilitate payments for scammers or look the other way when faced with red flags about their clients conduct.
Deceptive practices,regulatory violations
The FTC charged Paddle with multiple violations, including:
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Processing recurring subscription payments without clearly disclosing the renewal terms or obtaining informed consent;
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Enabling overseas merchants to evade fraud detection by financial institutions;
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Violating the FTC Act, the Telemarketing Sales Rule, and the Restore Online Shoppers Confidence Act.
The complaint further noted that Paddle continued processing payments even after clear warning signs about the fraudulent nature of its clients’ activities.
In a related case earlier this year, Paddle client Restoro-Reimage agreed to pay $26 million to settle similar FTC charges.
Terms of the settlement
Under the settlement filed in the U.S. District Court for the District of Columbia, Paddle is:
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Permanently banned from processing payments for tech-support companies engaged in telemarketing or using pop-up security messages;
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Prohibited from helping deceptive merchants or attempting to circumvent fraud monitoring systems;
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Required to implement robust merchant screening, monitor transactions, and report suspicious activity to payment-service providers;
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Required to obtain consumers express informed consent for subscriptions and provide a simple cancellation process.
The $5 million payment by Paddle will contribute to refunding consumers affected by the Restoro-Reimage scheme.
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