United States of America: Federal Trade Commission and Cleo AI reached settlement order in lawsuit for deceptive advertising and subscription practices

On 27 March 2025, the Federal Trade Commission (FTC) filed a stipulated settlement order with Cleo AI, Inc. in the US District Court for the Southern District of New York. The order resolved allegations that Cleo AI had misrepresented the availability and timing of advertised cash advances and imposed obstacles to cancelling paid subscriptions. While the FTC filed the complaint and the proposed order simultaneously on 27 March, Cleo AI had signed the agreement on 11 March 2025. The company consented to pay USD 17 million for consumer redress and agreed to injunctive provisions concerning disclosure of material terms, subscription consent, and cancellation procedures. The proposed order is subject to approval by the court before it becomes final.