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Uber is paying US$20 million to settle claims it misled drivers over potential earnings

By Koh Wanzi - on 29 Jan 2017, 11:03am

Uber is paying US$20 million to settle claims it misled drivers over potential earnings

Image Source: Uber

Uber will pay US$20 million to settle allegations that it attracted drivers to its ride-hailing service with misleading claims over how much they would earn and how much they had to pay to finance a car.

The Federal Trade Commission (FTC) brought the complaint against Uber, alleging that most Uber drivers in 18 major US cities were earning far below the figure published online. It also claimed that Uber promised to provide the best possible financing options to own or lease a car, but drivers ended up paying more and receiving less favorable rates than could be obtained with their credit scores.

According to the FTC, less than 10 per cent of Uber drivers in New York and San Francisco reached the level of income published by Uber. In a statement on Uber’s website that ran from May to August 2015, CEO Travis Kalanick put the mid-range annual incomes of New York City drivers at over US$90,000, and that of its San Francisco drivers at US$74,000.

In reality, FTC investigations determined that the actual figure was closer to US$61,000 and US$53,000 respectively, significantly less than Uber claimed.

By settling, Uber is not admitting to any missteps, but will instead pay US$20 million, a sum which will be distributed to affected drivers by the FTC. It will also issue compliance reports at intervals to the FTC, including driver earnings reports.

“We’ve made many improvements to the driver experience over the last year and will continue to focus on ensuring that Uber is the best option for anyone looking to earn money on their own schedule,” said an Uber spokesperson.

Source: The Guardian

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