The United States Federal Trade Commission (FTC) has filed a lawsuit against Genesis Tech, accusing it of deceptive subscription schemes. The FTC claims that the activities of this group of companies violated American law, actively using a network of affiliated companies to avoid regulatory oversight.
The Genesis Tech Group, based in Cyprus, has been actively operating through affiliate structures in the US, particularly in Delaware, since 2020. According to the FTC, between September 2024 and September 2025, the company collected about $700 million through the PayPal payment system alone. By leveraging the American regulatory system, they offered subscriptions that the commission believes did not meet proper standards of transparency and informed consent.
Oksana Zadneprovska, a lawyer from Axon Partners, explains that the charges are based on Section 5 of the FTC Act and the Restore Online Shoppers’ Confidence Act (ROSCA). These laws are aimed at protecting consumers from misleading practices and require clear disclosure of contract terms. With regard to affiliated persons, the FTC aims to ensure that they cannot use new companies to repeat similar activities.
According to the legal firm everLEGAL, possible sanctions against Genesis include a court injunction that has already been issued and may halt the company’s operations; a permanent ban with requirements to restructure the business model; monetary compensation tied to the income derived from violations; as well as the payment of civil penalties. Additionally, there is the possibility of personal liability for the company’s founders and management team.
The commission has already obtained a temporary court order “freezing” certain company activities, including assets in accounts at PayPal and JP Morgan Chase amounting to $8 million and $2 million, respectively. The court must decide whether this ban will be permanent or if additional sanctions will be applied.
| Date | Event |
|---|---|
| July 2, 2026 | Decisive hearing on the court injunction |
| August 25, 2026 | Written submissions of parties |
| September 1, 2026 | First strategy meeting on case management |
Considering the experience from previous cases like Adobe, Amazon, and others, the case might end with a settlement agreement. However, uncertainty regarding the final outcomes still remains, creating additional risk for all market participants.
