FleetCor Technologies, Inc. (FLT) Accused of Exploitative Business Practices
Since its IPO in 2010, FleetCor Technologies, Inc. (FLT) has experienced explosive growth with an over 300% revenue increase. According to FleetCor executives, this growth was realized the “old-fashioned way” through investments in “sales and marketing.” However, in reality, FleetCor utilized misleading marketing materials and other predatory sales schemes, including marketing its fuel cards as “no fee” or “free money.” Contrary to the claims made in its marketing, customers were shocked to discover they were being billed with late fees and other miscellaneous fees improperly added to their invoices. In May 2017, FleetCor eventually disclosed that the fees it imposed on customers amounted to $200 million or 10% of FleetCor’s revenue. Despite efforts to conceal its exploitative business practices, on March 1, 2017, business journal Capitol Forum published a report stating FleetCor “routinely imposes a myriad of unwarranted fees on customers” and that the Company’s billing system makes it “extremely difficult, if not impossible, for customers to make timely payments.” Then, on April 27th, 2017, Citron went public with the results of its investigation, alleging that not only has FleetCor profited from extraneous fees, but that it is also involved in the largest clean energy fraud in U.S. history. Following these revelations, FleetCor’s stock price fell 11.35%, a loss of approximately $1.5 billion in market capitalization.