The Federal Trade Commission (FTC) has announced a court order requiring the online retailer GOAT to pay over $2 million for violations related to shipping practices and buyer protection policies. The FTC's complaint alleges that GOAT, an ecommerce marketplace operated by 1661, Inc., failed to honor its advertised "Buyer Protection" policy and did not establish an effective customer service program for handling returns of deficient products.
According to the FTC, many consumers were denied refunds or only received store credit instead of full monetary refunds. Samuel Levine, Director of the FTC’s Bureau of Consumer Protection, stated, “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.”
GOAT advertises its verification process for products before shipment and offers different shipping options like "Instant," "Standard," and "Next Day." However, the FTC alleges that 37% of "Instant" orders and more than 16% of "Next Day" orders were shipped later than promised. Consumers who paid extra for faster shipping did not receive the option to agree to delays or cancel their orders for a refund.
The complaint also accuses GOAT of misrepresenting its return policies under its “Assurance of Authenticity” and “Buyer Protection Policy.” Many requests for returns due to inauthentic or incorrect products were rejected outright. The FTC claims that GOAT's customer service practices required persistent complaints from consumers before issuing full refunds.
Under the proposed court order settling the complaint, GOAT will pay $2,013,527 in refunds and is prohibited from continuing these illegal practices. The company must implement specific customer service practices when offering special product protections. Additionally, GOAT is barred from denying refund requests without clearly disclosing its denial policies.
The Commission's vote authorizing this action was unanimous at 5-0. Commissioners Melissa Holyoak and Andrew Ferguson issued separate concurring statements. The complaint was filed in the U.S. District Court for the Central District of California with Delilah Vinzon and Matthew Fine serving as lead staff attorneys on this matter.
The FTC emphasizes its role in promoting competition and protecting consumers through education about frauds and scams. More information is available at consumer.ftc.gov.
