New York City Targets Subscription Traps and Hidden Fees in Sweeping Consumer Protection Push
The Mamdani administration has adopted a rule banning companies from using deceptive subscription practices that trap customers into recurring charges for gym memberships, streaming services, and other commitments, the city’s consumer protection office announced. The rule takes effect 1 October and carries stiff penalties: companies failing to provide a simple cancellation mechanism could face $525 per user subscription, plus back fees and additional fines.
New York City would become the first US municipality to implement such a ban, according to the city.
The Subscription Rule
Samuel AA Levine, the city’s commissioner of consumer and worker protection — and a former head of consumer protection at the Federal Trade Commission — said the rule addresses a straightforward consumer frustration. “People shouldn’t have to wait on hold for half an hour or send a certified letter or show up to a store in person in order to cancel” a subscription, he said in an interview.
The economic stakes are significant. Companies earn billions annually from automatic subscription renewals that consumers either do not want or do not realize they have. The Roosevelt Institute, a thinktank, estimates the New York City rule alone could save residents as much as $162.5 million per year.
While the subscription rule applies only to city residents, a separate proposed junk fee rule would reach companies serving visitors — hotels, rental car agencies, and the like. Levine’s message to tourists hit with undisclosed fees at hotel check-in: “You should complain to us.”
The Junk Fee Proposal
The city is also moving against so-called “junk fees” — charges that inflate the final price of goods and services ranging from apartments to sporting events. A proposed rule would require sellers to “advertise the total price for any good or service, including all mandatory additional charges and fees, up front,” according to a release.
The housing market implications are particularly broad. Approximately 70% of New York City residents rent, and apartment seekers across the US increasingly confront add-on charges such as “boiler management” and “lifestyle” fees imposed by management companies. These fees can push true rental costs hundreds of dollars above the prices listed on real-estate websites.
If the proposed rule passes following public comment and a hearing, all mandatory fees — including annual charges — would need to be folded into the stated monthly rental price, Levine said.
The current landscape, Levine argued, creates “a scenario where rather than competing on price, companies are competing on their ability to hide the true price. That’s the worst kind of incentive” — one he said deeply distorts the market.
Political and Regulatory Context
The measures reflect an aggressive push by Mayor Zohran Mamdani and Levine to curb what they characterize as predatory corporate practices. The announcement came at a press conference on 21 January 2026.
Levine framed the effort as a corrective to decades of deregulatory orthodoxy. “In the dawn of the [Ronald] Reagan era, the FTC and others in Washington said expressly that … markets could correct themselves, regulate themselves, they were going to stop writing rules” and allow companies to police their own behavior, he said. “What it has gotten us is 40 years of deceptive pricing.”
The administration’s consumer protection agenda aligns with its broader campaign to address New York City’s affordability crisis. Members of Mamdani’s democratic socialist group endorsed by the mayor won a flurry of recent primary elections, reflecting some voters’ embrace of leftwing populism aimed at empowering working-class Americans.
Industry Resistance and Federal Parallels
Junk fee bans and subscription trap rules enjoy broad consumer popularity but face fierce industry opposition. When the Biden administration introduced a federal junk fee rule in 2024, the US Chamber of Commerce called it “an attempt to micromanage businesses’ pricing structures.” Apartment fees were subsequently stripped from the federal rule after real-estate industry lobbying.
A national click-to-cancel rule introduced under Biden was struck down by a federal judge in 2025 — days before it was to take effect — over a procedural issue. Donald Trump’s FTC reportedly plans to pursue a similar rule in the coming months, suggesting some bipartisan convergence on the issue at the federal level.
Surveillance Pricing and Next Steps
Separately, the New York City Council has proposed banning “surveillance pricing,” a practice in which companies charge consumers different prices for the same good or service based on algorithmic data about spending habits and personal behavior. Maryland banned the practice in April; Colorado’s governor vetoed a similar ban last month.
The junk fee rule will undergo public comment followed by a hearing. “I certainly hope that we can get this rule done by the end of the year,” Levine said.
Note: An earlier headline for this story was amended on 11 July 2026 to clarify that New York City has adopted a subscription rule while the junk fee measure still requires public comment and a hearing before finalization.