States Hit Hardest by Deceptive Tactics Ahead of Black Friday

November 25, 2024

States Hit Hardest by Deceptive Tactics Ahead of Black Friday

Every Texan received $8.12 per capita in refunds, the highest of any state, while Vermont residents saw the highest average refund of $235.49 per defrauded victim
Over six years, the FTC secured $2.18 billion in refunds for American consumers deceived by pricing tactics
Deceptive pricing is a tactic that inflates prices before sales, creating the illusion of a bargain when marked down

With Black Friday just around the corner, the spotlight falls on deceptive pricing tactics – a troubling trend where companies inflate prices just before major sales, only to mark them down, creating the illusion of a bargain. According to a new study by digital marketers SEOProfy, tactics like this led to attempts to defraud Americans out of $2.18 billion over the past six years.

The Federal Trade Commission (FTC) has fought back, recovering billions for defrauded customers through lawsuits. In fact, over the past six years, the FTC has successfully won back $2.18 billion, reimbursing consumers who had fallen victim to deceptive pricing. Texas, Maryland, and Colorado saw the highest losses per capita, with residents losing between $7.69 and $8.12 each, but the FTC succeeded in securing refunds. Vermont, on the other hand, received the largest average refund per customer, totaling $235.

As holiday shoppers gear up for deals, these findings highlight the importance of vigilance. Misleading discounts can turn supposed savings into losses, especially when companies rely on tactics designed to deceive. SEOProfy analyzed official FTC data on refunds processed through lawsuits between 2018 and 2023. These refunds were sent directly to consumers by the FTC, without requiring them to take legal action.

Texas is the most cheated state in America, based on how much every resident won back in refunds through the FTC. Over six years, companies tried scamming every Texan of at least $8.12.

Considering this is relative to its population, as the second biggest US state, Texas almost lost nearly $244 million were it not for FTC’s intervention in claiming all this sum back on their behalf. This is the second biggest total refund value that the FTC won back in any US state, outranked only by California, who had initially lost almost $259 million during the same period.

Maryland ranked second for the most defrauded customers per capita. On average, the FTC returned $8.03 to every Marylander between 2018 and 2023. This amounts to $49.5 million.

Colorado has the third most scammed customers of all US states, where companies tried cheating every resident out of $7.69 in recent years. In total, Colorado had originally lost $44.9 million, which the FTC managed to recuperate over the past six years.

Vermont received the biggest refund checks of all US states, averaging $235.49 per victim. Ironically, this is where the fewest defrauded customers are (12,136), but their losses were that much higher overall ($2.86 million) that it resulted in a bigger share per recipient. Because of its second-lowest population size, Vermont averaged only $4.42 per resident – the third-lowest refund per capita.

Utah and West Virginia are the bottom two states to whom FTC awarded the lowest refunds per capita. Between 2018 and 2023, they each lost $4.22 and $4.35 per resident, respectively.

Commenting on the study, Victor Karpenko, CEO of SEOProfy said,

“Our study covers a wide range of industries, but one thing that services have in common that we can control is terms and conditions.

“We know how daunting they can be, especially for smaller amounts of money, but this is not even about the money. There are more valuable things you could lose that can eventually lead to the FTC granting you a refund, like a data breach jeopardizing your credit score, identity and online security. Please do not wait for greedy companies to get caught after they take your money and possibly put you at risk. Please do not rush into contracts – it can easily cost you more than the time needed to read it carefully.”

Top States with The Highest Refunds Through Lawsuits per Capita (2018-2023)

#	State	Total refund value ($)	Total refund recipients	Refund value per recipient ($)	Refund value per capita ($)
1	Texas	243,865,490	1,361,265	179.15	8.12
2	Maryland	49,512,160	239,963	206.33	8.03
3	Colorado	44,934,740	237,430	189.25	7.69
4	Nevada	24,431,566	149,857	163.03	7.69
5	North Carolina	82,117,060	407,519	201.5	7.68
6	Delaware	7,783,975	36,647	212.4	7.64
7	Arizona	54,664,383	325,179	168.11	7.43
8	Florida	164,263,895	963,370	170.51	7.38
9	New Mexico	15,396,917	82,188	187.34	7.29
10	Louisiana	33,294,330	186,320	178.69	7.25
11	Mississippi	21,010,532	106,702	196.91	7.15
12	Illinois	89,451,197	463,985	192.79	7.11
13	Alabama	35,498,415	189,518	187.31	7
14	Indiana	47,158,405	235,981	199.84	6.9
15	Wyoming	3,958,538	21,009	188.42	6.81
16	Tennessee	47,575,800	248,782	191.23	6.75
17	Arkansas	20,382,994	100,216	203.39	6.69
18	California	258,778,721	1,387,630	186.49	6.63
19	Pennsylvania	84,554,566	409,838	206.31	6.52
20	Missouri	39,692,382	213,374	186.02	6.42
21	Georgia	69,385,760	410,716	168.94	6.36
22	Nebraska	12,317,596	56,751	217.05	6.26
23	South Carolina	32,756,956	194,745	168.2	6.2
24	New Jersey	57,261,286	244,298	234.39	6.18
25	Alaska	4,519,236	26,009	173.76	6.16
26	Rhode Island	6,712,641	33,432	200.78	6.14
27	Oklahoma	24,558,819	141,318	173.78	6.11
28	Washington	47,555,033	254,676	186.73	6.11
29	South Dakota	5,459,201	24,542	222.44	6
30	New York	116,443,070	554,850	209.86	5.92
31	Iowa	18,881,038	81,592	231.41	5.9
32	Minnesota	33,055,633	146,391	225.8	5.78
33	Oregon	24,502,437	132,264	185.25	5.78
34	Kentucky	25,856,253	142,151	181.89	5.73
35	Connecticut	20,591,455	100,937	204	5.68
36	North Dakota	4,399,578	20,789	211.63	5.65
37	Montana	6,205,987	33,442	185.57	5.53
38	New Hampshire	7,571,576	38,106	198.7	5.43
39	Michigan	54,203,318	325,158	166.7	5.4
40	Wisconsin	31,802,128	143,219	222.05	5.4
41	Virginia	46,059,247	283,735	162.33	5.3
42	Hawaii	7,383,342	43,958	167.96	5.13
43	Ohio	60,187,254	388,276	155.01	5.12
44	Kansas	14,096,684	86,717	162.56	4.8
45	Maine	6,489,613	34,059	190.54	4.68
46	Massachusetts	32,375,430	168,787	191.81	4.64
47	Idaho	8,909,031	54,624	163.1	4.59
48	Vermont	2,857,880	12,136	235.49	4.42
49	West Virginia	7,717,540	52,448	147.15	4.35
50	Utah	14,262,367	92,603	154.02	4.22

Story credit: SEOProfy to https://seoprofy.com/

Sources: SEOProfy, Federal Trade Commission.

Methodology:

The study uses the data from the Federal Trade Commission (FTC) on FTC Refunds to Consumers between January 1^st, 2018, and December 31^st, 2023, available at https://public.tableau.com/app/profile/federal.trade.commission/viz/Refunds_15797958402020/RefundsbyCase(accessed on August 14^th, 2024)
The researchers collected the data per state and normalized it by 2022 Census population to allow for comparisons across states.
The study offers state-level indicators for total refund values, total refund recipients, refund value per recipient and refund value per capita. These indicators are collective for the six analyzed years.
In order to evaluate how successful each state is at winning refund lawsuits, collectively, the main ranking orders the value of processed refund value per capita from highest to lowest.

Note: The total amount refunded by the FTC worth $2.18 billion includes all US states, territories and DC.

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