Stamps.com settles $4 million lawsuit with Santa Clara and Santa Cruz Counties

SANTA CLARA COUNTY, Calif. (KGO) -- An online postage service has agreed to pay $4 million to settle a consumer lawsuit filed by Santa Clara and Santa Cruz Counties.

Prosecutors say Stamps.com offered a no-risk trial without clearly disclosing that customers would be automatically enrolled in their fee-based monthly service.

The Southern California company will pay $2.5 million in penalties and $1.5 million in restitution for victims. It also agreed to make changes to its website so fees are easier to understand.