The $4.95 Free Trial That Turned Into a $90 Monthly Charge

An ad for a beauty or weight-loss product offers a free trial — just cover the cost of shipping, typically under $5. Two weeks later, a charge for roughly $90 appears on the consumer's statement. Then another one the following month. According to the Federal Trade Commission, that was the business model behind AH Media Group, LLC, which made an estimated $74 million enrolling consumers in paid subscriptions for cosmetics and dietary supplements they never realized they had agreed to.DOCUMENTED

The FTC filed its original complaint against AH Media Group and its owners, Henry Block and Alan Schill, in July 2019, later amending it to add Zanelo, LLC as a defendant.DOCUMENTED Refunds tied to the case, which the FTC first returned in June 2022, are still going out to affected consumers years later.

What the complaint alleges

According to the FTC's complaint, AH Media Group offered “trials” of its products for the cost of shipping and handling alone, typically around $4.99 or less, before enrolling consumers in expensive recurring subscriptions they had not knowingly agreed to.DOCUMENTED By using dozens of nominally distinct companies to process these transactions, the FTC alleges the defendants circumvented payment processors' underwriting requirements and fraud-monitoring programs, making it more difficult for both consumers and law enforcement to detect the scale of the underlying scheme.DOCUMENTED

Blocking the exit at every turn

The complaint describes a cancellation process built to frustrate rather than facilitate consumer exit: consumers were not permitted to cancel online, and instead had to call a customer service number where they were frequently placed on hold for extended periods.DOCUMENTED More striking, according to the complaint, is what happened when a frustrated consumer instead disputed the charge directly with their credit card company: the defendants allegedly created and used fraudulent versions of their own websites specifically to prevent those consumers from being reimbursed through the chargeback process, effectively fabricating evidence to defeat a legitimate dispute.DOCUMENTED Andrew Smith, then Director of the FTC's Bureau of Consumer Protection, said plainly: “These companies promised free products for only the cost of shipping, but then charged consumers for expensive subscriptions.”DOCUMENTED

Why using dozens of shell companies mattered

Operating through numerous nominally separate corporate entities is a structural tactic that serves a specific evasive function in a scheme like this one: payment processors monitor individual merchant accounts for unusually high rates of customer disputes and chargebacks, and a merchant that trips those thresholds risks having its ability to process card payments revoked entirely.REVIEWED By spreading transactions across many distinct shell entities, each one individually stays below the threshold that would trigger heightened scrutiny, allowing the overall operation to continue collecting payments even as complaints against the underlying business model accumulated.

Terms of the settlement and ongoing refunds

The court orders settling the FTC's complaint permanently ban the defendants from negative option marketing — the practice of treating a consumer's silence or inaction as consent to be charged — and require them to obtain consumers' express consent before any billing.DOCUMENTED The defendants were required to turn over approximately $4,345,000 combined, which the FTC has used to fund refunds, including a $5.4 million distribution in June 2022 and further rounds of refund checks and PayPal payments continuing well into 2026, more than seven years after the original complaint was filed.DOCUMENTED

When consumers disputed the charges with their credit card companies, the complaint alleges the defendants used fraudulent versions of their own websites to defeat the reimbursement claims.

Why the case matters

The years-long gap between the original 2019 complaint and refund payments still being issued in 2026 illustrates how long a negative-option enforcement case can take to fully resolve for affected consumers. For anyone who has ever entered a card number for a “free trial” online, the AH Media Group case is a reminder to check bank and card statements closely in the weeks following any trial offer, and to know that a company blocking online cancellation in favor of a hold-heavy phone line is a recognized pattern regulators have repeatedly found associated with exactly this kind of scheme.

Why chargebacks are supposed to be a consumer's last line of defense

The credit card chargeback system exists specifically to give consumers a way to reverse unauthorized or disputed charges when a merchant refuses to resolve the issue directly, functioning as an independent check outside the merchant's own control.REVIEWED The complaint's allegation that AH Media Group fabricated evidence on fraudulent versions of its own websites specifically to defeat that process describes an attempt to compromise the one remaining consumer protection mechanism that operates independently of the merchant itself — a more severe violation than simply making cancellation difficult, since it targets the backstop designed to work even when a company's own customer service fails entirely.

What the multi-year refund timeline reveals

Refund distributions tied to this case have continued well past the original 2019 complaint, with rounds reported in June 2022, December 2024, and into 2026 — a timeline reflecting how the FTC's redress fund administrators continue locating eligible consumers and reissuing payments to those who did not cash earlier checks, sometimes years after the initial distribution.REVIEWED That extended timeline is itself a reminder that a settlement announcement is not necessarily the final word on a case's consumer redress; unclaimed funds can continue circulating back to eligible consumers long after the news coverage of the original settlement has faded.

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