UK Fintech Paddle Fined $5M by US Regulators Over Tech-Support Payment Abuse

The penalty comes after the Federal Trade Commission (FTC) accused Paddle of helping two companies—onboarded over five years ago—engage in deceptive telemarketing practices.

According to the FTC, these companies targeted US consumers, including older adults, using fake virus alerts and pop-up messages that impersonated trusted brands like Microsoft and McAfee. Paddle allegedly processed payments for these schemes, costing consumers millions of dollars.

Christopher Mufarrige, director of the FTC’s Bureau of Consumer Protection, said: “Paddle provided foreign-based tech-support schemes with access to the US payment system, allowing these companies to harm consumers.

“The FTC will hold accountable payment companies that knowingly facilitate payments for scammers or look the other way when faced with red flags about their clients’ conduct.”

The US regulatory investigation was first reported by the website UKTN. Paddle responded by stating that the regulator confirmed it did not process any payments related to “deceptive telemarketing practices.”

Jimmy Fitzgerald, CEO at Paddle, said: “Paddle serves over 6,000 digital product companies, whose innovative technology collectively brings incredible value to consumers all around the world.

"And whilst we believe that almost all digital product companies are ‘forces for good’, it is sadly a reality that there are some bad faith actors out there.”

Paddle provides software companies with services like checkout, payments, subscription management, invoicing, international tax handling, and financial compliance. It’s backed by investors including FTV Capital, 83North, Notion Capital, and Kindred Capital.

In 2022, Paddle was valued at $1.4 billion after raising $200 million in a Series D funding round.

About Paddle

Paddle simplifies global payments for SaaS and digital product companies by handling the complexity for you. As a Merchant of Record, Paddle takes care of payments, currency conversion, fraud protection, customer billing support, and local tax compliance .