In a significant development for the embattled customers of SmileDirectClub, New York Attorney General Letitia James has recovered $4.8 million in funds improperly charged by the telehealth company. The beleaguered company had continued to levy charges on its products and services after declaring bankruptcy in September 2023 and ceasing operations. According to the official press release, over 28,000 consumers, with 2,265 residing in New York, fell victim to this blunder.
Following a torrent of complaints from customers blindsided by the company's abrupt discontinuation yet persisting in charging fees, the Office of the Attorney General intervened. "SmileDirectClub shut its doors for good, but illegally continued to charge New Yorkers for costly dental services," said Attorney General James. Addressing the matter to the consumers, "Today, we are putting money back into people's pockets who were cheated and reminding companies that if they prey on New Yorkers, my office will step in to protect consumers," James conveyed in a statement obtained by the press release.
The saga of SmileDirectClub has seen customers enrolled in their "SmilePay" program, mostly shelling out a $250 initial payment followed by monthly installments, often totally above $2,500. When the company went under, they not only stopped fulfilling orders but continued to mislead customers by instructing them to fulfill outstanding payments, as per details shared by the Attorney General's office. This prompted a crackdown in the form of a cease-and-desist letter in December 2023, followed by a negotiated settlement that brings some solace to the affected consumers.
Under the terms of the settlement, refunds will be processed by the company's payment processor, Healthcare Finance Direct. The procedure is detailed out, where a portion of these refunds will be automatic, while others will be claimable through an online request. According to the same New York Attorney General's press release, they are committed to reaching out to the eligible consumers through email with pertinent information on securing their refunds.
Consumers who find themselves ensnared in misleading billing practices are encouraged to take action. Attorney General James asks any patient who believes they have been a victim to file a complaint online or call 1-800-428-9071. The unwavering efforts to rectify financial injuries to customers reflect the consistent dedication of the Consumer Frauds and Protection Bureau, under the wider auspices of the Division for Economic Justice and the Division for Social Justice, as delineated in the Attorney General's office narrative.
