FTC v HomeAdvisor (Jan 2023) — up to $7.2M order; $3M+ refunded to 110,000+ contractors by Nov 2023

Claim: The dominant fact in the recent history of contractor marketing is the FTC's January 2023 administrative order against HomeAdvisor. The complaint alleged that "since at least mid-2014, HomeAdvisor made false, misleading, or unsubstantiated claims about the quality and source of the leads it was selling to home service providers." The final consent order (April 2023) required HomeAdvisor "to pay up to $7.2 million for using a wide range of deceptive and misleading tactics in selling home improvement project leads to service providers, including small businesses operating in the 'gig' economy."

By November 2023, the FTC had mailed more than $3 million in refund checks to over 110,000 contractors.

Sources:

• FTC press release, January 2023: https://www.ftc.gov/news-events/news/press-releases/2023/01/homeadvisor-inc-pay-72-million-deceiving-small-businesses-leads-home-improvement-projects
• FTC consent order, April 2023.
• FTC refund-mailing release, November 2023.

Confidence: Verified (federal regulator primary source).

For Candid: This is the regulator-validated core of the "agency-burned" narrative. A Canadian GC who used HomeStars (Angi/IAC-owned since 2017) in 2018–2022 had a substantively negative experience that has been validated by a U.S. federal regulator. The aversion is not invented; it is built on a documented regulatory record. Critically, however, the regulatory record concerns lead-gen marketplaces, not full-service marketing agencies — and Candid's audience often does not distinguish between the two categories. This conflation is a more durable obstacle than the original burn. Operationalized as [[rule-refuse-lead-gen-platform-value-proposition]].

Related: [[vermont-ag-angi-100k-settlement-oct-2025]] (follow-on state action), [[angi-q3-2025-17pct-pro-decline-churn]] (business-pressure ratification), HomeStars corporate history: founded 2006 Toronto by Nancy Peterson; acquired by HomeAdvisor (IAC) Feb 2017; Peterson stepped down July 2020; Angi Inc. spun off from IAC March 31, 2025 (Canadian corporate trajectory).