SmileDirectClub plans to pay $4.8 million in refunds to more than 28,000 consumers who were improperly charged by the former teledentistry company.
Six notes:
1. SmileDirectClub announced in December 2023 that it was shutting down its global operations immediately after efforts to recapitalize the business failed.
2. At the time of the closure, the company said it was unable to provide support to its existing customers but that more information about refunds would become available once next steps were determined. Patients under the company's SmilePay Plan were still expected to continue their monthly payments until payment for their clear aligners were made in full.
3. Payments for the SmilePay plan included a $250 up-front payment, followed by 26 monthly payments of approximately $89 per month, according to a Dec. 2 news release from the New York State Attorney General's office.
4. The state attorney general's office said it sent a cease-and-desist letter in December 2023 to SmileDirectClub to stop advising consumers to continue making payments because it was no longer providing any services.
5. SmileDirectClub referred the office to HPS Investment Partners, the agent of its secured lenders, and Healthcare Finance Direct, its payment processor. The companies cooperated with the attorney general's investigation and stopped sending customers to collections.
6. The attorney general's office said a portion of the refunds will be issued automatically, and additional refunds will be given to customers who submit an online request to Healthcare Finance Direct.