Bloomberg News reports that Chief Executive officer Ron Clarke of FleetCor Technologies Inc successfully pitched small businesses to make payments in a better way for gas. In the process, he has become a billionaire.
However, the success he earned was based on dishonestly advertised rebates, concealing transaction fees, and carrying out many other unfair practices. Clarke was aware of it as per a ruling by a federal judge in Atlanta this week in a case brought by the Federal Trade Commission.
Clarke and FleetCor were accused of unethical practices earlier, although he dodged such allegations and said it was “fake news.” However, the US District Judge, Amy Totenberg, discovered that the FTC had come out with overwhelming evidence for inflicting harm on customers. Without a trial, she ruled against FleetCor, and it surfaced that Clarke was also responsible.
According to the Judge, it is evident that Clarke was aware of the unlawful practices of FleetCor, or he was indifferent to what was going on, while giving an order on August 9th, wherein the company is barred from continuing with any such practices further. However, she has not agreed to FTC’s request for damages, stating that as per a Supreme Court ruling of 2021, which barred the commission from filing a lawsuit for monetary relief.
Pervasive Violations
FleetCor offers fuel cards, a type of credit card that firms with a car fleet can issue to the employees for the purchase of gas while on duty, as well as miscellaneous expenses related to travel.
Bloomberg News reports that evidence from FTC shows that FleetCor was engaged in “pervasive and long-lasting” anomalies aiming at customer deception. It was also noted that FleetCor made promises that there would be no annual and transaction fees, but in reality, the card attracted terms like “convenience network surcharge” and “minimum program administration fee” that were applied without notifying beforehand.
The judge pointed out internal documents of FleetCor that most of the company’s customers were running small businesses and had used less than ten cards. These smaller companies failed to read between the lines as they comprised mostly “unsophisticated people” and people who were not business owners. For this group, their main language was not English.
According to Bloomberg Billionaires Index, Clarke has gathered as much as a $1.1 billion fortune. Clarke’s main aim was to bring together the market for fuel cards which is still fragmented. There are many companies that FleetCor has acquired in the United States and overseas under the leadership of Clarke. Last year, the company posted revenue of $2.8 billion.
