Class Action Lawsuit Alleges GoFundMe Automatically Adds ‘Tips’ to Donations Without Consent

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A proposed class action lawsuit alleges that GoFundMe uses a deceptive website design to furtively add “tips” to consumers’ donations without consent.

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The 25-page lawsuit contends that GoFundMe, a for-profit fundraising platform that acts as a middleman between donors and fundraisers/causes, employs a deceptive website interface with which it adds to donations purportedly optional “tips” for the platform, without first obtaining donor consent.

According to the complaint, when a consumer attempts to make a charitable donation on GoFundMe, they are directed to a checkout page that is “riddled with deception.” The lawsuit says that once a donor selects a desired donation amount for the charity of their choice, GoFundMe automatically pre-selects a 17.5 percent “tip” to add to the donation without any further action from the user.

Per the filing, GoFundMe does not obtain affirmative consent before tacking these “tips” onto donations. The case says that GoFundMe’s automatically added tips are an example of unlawful “negative option” pricing, whereby a consumer’s silence or failure to affirmatively reject an offer is interpreted as consent.  

Notably, the complaint claims that the automatically added tips are “obscured” by GoFundMe, which only discloses the fees in small font, designed to be easy to overlook, at the bottom of the checkout screen. Moreover, donors must “hunt around” to find a way to remove the surreptitiously added fees, creating the impression that the optional tip is in fact mandatory, the case states.

Further, GoFundMe represents to consumers that it “relies primarily” on the purported tips added to donations to continue operating but does not disclose that it already collects hefty pre-determined transaction fees from every donation made to individuals or organizations. Per the complaint, “tips” to GoFundMe are simply a convenient source of additional revenue for the platform, “entirely untethered from a given consumer’s donation.”

“While Plaintiffs and other reasonable consumers are generous, they have no interest in enriching a private tech company like GoFundMe as part of their charitable donations,” the lawsuit emphasizes. “But, unwittingly, and because of GoFundMe’s website-design tricks and other deceptions, that is exactly what occurs.”

The lawsuit says that GoFundMe’s “tips” are “precisely” the kind of junk fee that’s been subject to government scrutiny in recent years. Indeed, the suit notes that 21 attorneys general and charitable regulators sent a letter to GoFundMe demanding immediate action after the platform improperly collected additional fees from donors by way of a default tip.

The case states that had the plaintiffs and proposed class members known that the pre-selected tip for GoFundMe was optional, or that tips did not cover the fundraising platform’s operating costs as represented, they would have chosen not to pay the fee.

The GoFundMe class action lawsuit looks to cover all individuals in Illinois or Georgia who, within the applicable statute of limitations, paid GoFundMe a pre-selected fee in the form of a “tip.”

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