On October 29, 2026, the Federal Trade Commission, California through the Los Angeles County Counsel and San Francisco City Attorney, and the attorneys general of Colorado, Florida, Illinois, Iowa, Nebraska, Oklahoma, and Utah sued Toast Inc., the restaurant point-of-sale and fintech company. The complaint alleges hidden fees, unauthorized charges, deceptive cancellation practices, and unfulfilled support promises. The case is laid out in the news release from the Office of the Illinois Attorney General, "Attorney General Raoul Files Lawsuit Against Toast Inc. Over Hidden and Unauthorized Fees, Deceptive Subscription Practices and Other Unlawful Conduct," dated October 29, 2026.

Nothing here has been decided. These are allegations in a complaint, and Toast says it disagrees with them. The dollar figures in the filing are specific enough that any owner paying a software vendor by subscription can use them as a checklist for their own contract.

What did the FTC and state attorneys general accuse Toast of on October 29, 2026?

On October 29, 2026, the Federal Trade Commission, California through the Los Angeles County Counsel and San Francisco City Attorney, and the attorneys general of Colorado, Florida, Illinois, Iowa, Nebraska, Oklahoma, and Utah filed a lawsuit against Toast Inc. The Illinois Attorney General's office says the complaint alleges that Toast saddles restaurants with hidden fees and unauthorized charges, fails to deliver on its customer support promises, and makes it difficult to cancel its services.

The Office of the Illinois Attorney General says the complaint alleges that Toast violated the FTC Act, the Restore Online Shoppers' Confidence Act, and Illinois consumer protection laws. The complaint describes the Restore Online Shoppers' Confidence Act as requiring a seller that charges online through a negative option feature, such as an auto-renewing subscription, to clearly disclose all material terms before taking billing information, obtain express informed consent for the charges, and provide simple ways to stop recurring charges. Ask a lawyer how it applies to an agreement you have signed. Nation's Restaurant News reports that Toast argues the law does not apply to contracts between businesses, and that the complaint asks the court to block Toast from continuing the alleged practices and seeks monetary damages and civil penalties.

Toast has responded publicly. Nation's Restaurant News reports that the company strongly disagreed with the allegations and said it had been working with the FTC since mid-2025 to resolve the claims outside of court; Toast said in a statement that the FTC disregarded information it provided showing the extent to which its restaurant customers negotiate their contracts, and that nothing about the news changes its customer service, pricing, or support.

No court has found Toast liable. Treat everything below as what the government alleges, not as established fact.

How much does Toast cost per month, and what's in the subscription?

Toast markets and sells point-of-sale hardware and software and payment processing services to small businesses in the restaurant industry, and it sells its software through annual or biennial subscriptions that are billed monthly, according to the Illinois Attorney General's office. The same release says Toast also markets and sells financing products, called Toast Capital loans, to existing Toast customers. Nation's Restaurant News describes Boston-based Toast as one of the largest tech providers for small and medium-sized restaurants.

To obtain Toast products and services, restaurants must enroll in auto-renewing subscriptions with an average cost of around $900 per month, depending on the number of terminals used and the add-on services bundled into the subscription, per the Illinois release. That average comes from the Illinois release only. The FTC's release says only that subscriptions vary in cost depending on the number of terminals used and the add-on services, and the complaint, which redacts the average, says Toast subscriptions start at about $90 per location per month. Employee timekeeping, payroll processing, and filing of payroll taxes are among the add-on services the Illinois release names as examples. The complaint says Toast customers frequently complain that they have been enrolled in, and charged for, add-ons without their consent.

There is also a $0-per-month option. Toast advertises a "pay-as-you-go" plan where customers pay higher fees per transaction for payments processed while getting hardware and software for $0 per month. Nation's Restaurant News reports that the lawsuit alleges this plan is marketed toward one- or two-unit restaurants and that the $0 price only applies to one POS terminal, even though it is advertised for restaurants that need one to two terminals.

The complaint says pay-as-you-go customers face other costs. Pay-as-you-go customers who do not start processing payments within 120 days of purchasing their subscription must return all of their hardware or pay its full retail value, according to the Illinois Attorney General's release, and the complaint says that term appears only in a gray, fine-print disclosure scroll box. For an owner whose buildout slips past four months, that clause converts a delay into a bill. The FTC's release adds that restaurants that must close temporarily are still required to pay $85 a month for payment processing.

What is the Toast $0.99 online order fee, and is it still being charged?

From September 2021 through late July 2023, Toast added a $0.99 fee to certain online orders above $10 placed through its platform, and the Illinois Attorney General's office says that fee went to Toast and not to the restaurants, on top of the fees those restaurants were already paying Toast. The complaint alleges Toast charged restaurant patrons that fee without adequate disclosure or consent from the patrons or the restaurants.

According to the Office of the Illinois Attorney General, the complaint describes Toast's $0.99 online-order fee as a past practice that ran from September 2021 through late July 2023, not as a current charge. Nation's Restaurant News reports that the fee sparked widespread backlash among restaurants in the summer of 2023 and Toast removed it, and that the lawsuit says the company has not reimbursed customers for it.

The fee matters because the complaint says diners paid a charge that went to Toast rather than to the restaurant. A per-order charge of under a dollar, applied to a slice of orders, is close to invisible on a busy Friday. The pattern to watch for in your own statements is a small automatic charge that goes to a party the line item does not clearly identify.

What early termination fee may apply when canceling Toast?

The Illinois Attorney General's office says the complaint alleges Toast failed to provide a simple cancellation process, and instead uses a multi-step process that requires the coordination of multiple teams within Toast, leaving many customers to incur months or years of unwanted charges. The Nebraska Attorney General's office reports that the complaint alleges cancellation required written notice, multiple contacts with customer-service teams, and in some cases sales pitches.

Then there are the exit charges.

That example is one customer's complaint as described in the filing, not an advertised rate card. The FTC's release does give a figure: according to the complaint, customers who wish to cancel are required to pay an undisclosed early termination fee of $150 per month for each remaining month of their contract. The complaint ties that fee to the pay-as-you-go plan and says it applies even after the initial 120-day period, no matter how long the customer has been processing payments at the higher rate. Terms vary by contract, which is why the number to find is the one in your own agreement.

If you are on Toast, or on any software subscription billed monthly under an annual or multi-year term, pull the contract and find four things:

• The term length and the exact auto-renewal date.
• The early termination fee, as a dollar figure or as the formula that produces one.
• The written notice period and the address or portal where notice must be sent.
• Whether any add-on, such as payroll or timekeeping, carries its own separate term that survives cancellation of the main subscription. The complaint says Toast payroll customers must give written notice at least ninety days before the end of the payroll subscription term, separately from canceling the main subscription.

A support line that answers at 2 a.m. is a different thing from a cancellation path you can finish in an afternoon. The complaint's allegation is that Toast advertised the first and delivered neither.

How can a Toast Capital loan turn cancellation into a default?

Toast Capital is financing offered to existing Toast customers. According to the Illinois Attorney General's office, the complaint alleges that if customers cancel their subscriptions or change providers, Toast treats this as if the customers have defaulted on their loan and requires them to immediately pay the total outstanding amount of the loan. The release says the complaint alleges this forced customers to choose between continuing to pay unwanted subscription charges or facing accelerated loan repayment in addition to any early termination fee.

The general lesson holds well beyond this case. When the same vendor provides software and financing, check whether canceling the software accelerates the outstanding loan balance. Before you accept financing from a company whose subscription you also pay, get a written answer to one question: does ending, pausing, or switching the service accelerate the loan balance? Ask for the clause, not a summary over the phone, and consider having a lawyer read it before you cancel or switch providers.

Does Toast actually offer 24/7/365 support?

The complaint says nearly every page of Toast's website highlights some variation of the claim that customers can get help 24 hours a day, seven days a week, and that during the subscription enrollment process Toast lists "24/7/365 support" as a feature in each of its subscription packages. In reality, consumers have difficulty reaching anyone who can provide support or answer their questions at any time of day, let alone 24/7, according to the complaint as described by the Illinois Attorney General's office.

The release cites one consumer who called Toast customer support on a Saturday only to be told that the team that could help him was not available, costing the small business owner thousands of dollars of credit card transactions. Nation's Restaurant News reports that the lawsuit includes complaints from more than a dozen customers who said they had trouble getting in touch with someone at Toast, even after weeks or months of trying.

What should restaurant owners using Toast review?

Your contract governs your situation. These are practical steps an owner can take while the case is pending.

1. Pull your last three invoices and read every line. Flag any add-on you do not recognize. Employee timekeeping, payroll processing, and filing of payroll taxes are among the examples the Illinois release names.
2. Find the notice deadline and the early termination fee. Set a reminder early enough to send the required notice before the auto-renewal date, and if the contract gives a formula for the fee, do the math now rather than on the day you want to leave.
3. If you carry a Toast Capital balance, calculate the payoff before you shop other providers, because the complaint alleges that canceling or switching triggers immediate repayment of the full outstanding amount.
4. Document anything you believe was unauthorized with dates, amounts, and invoice numbers. Keep that file with your contract, and ask your attorney which complaint channels are open to a business in your situation.
5. Do not assume the next vendor is safer. Before you sign, get the early termination fee in writing, ask whether any bundled financing accelerates on cancellation, and call the support line on a Saturday night to see who answers.

Here is a request you can send your vendor's account team today. It asks for the terms that decide what leaving costs.

Subject: Written confirmation of contract terms - [Business name], account [####]

Hi [Name],

Please confirm the following in writing for our account:

1. Current term: start date, end date, and the exact auto-renewal date.
2. Early termination fee: the dollar amount as of today, or the formula
   used to calculate it.
3. The written notice period and the exact address or portal where
   cancellation notice must be sent.
4. Any financing balance tied to this account, the current payoff amount,
   and whether canceling the subscription or switching providers changes
   the repayment schedule. Please quote the acceleration clause.

Please reply by email rather than by phone so we have a written record.

Thank you,
[Your name], [Title]
[Business name]

Save the vendor's written response with your contract, and track each renewal date, notice period, termination fee, and loan payoff in one spreadsheet.

How to catch unexpected vendor charges on your business account

Fee problems like the ones alleged in this complaint show up during reconciliation. A $0.99 line item or a payroll add-on nobody enabled hides well inside a single lump settlement from a processor, so take your POS sales report for the month, subtract the fees the vendor says it charged, and compare that figure to the deposits in your business checking account. A gap you cannot explain is where a hidden fee surfaces first. Then match each subscription debit to an itemized invoice line and chase anything that does not match.

Novo offers a business checking account for small businesses with a $0 monthly fee and no minimum balance requirement. An account that ends the day at $0 for 130 consecutive days may be closed. Novo integrates with Stripe, Square, and PayPal; their payouts go to your Novo account, and their own fees apply. Novo also integrates with QuickBooks Online (QuickBooks has its own pricing plans), Xero, and FreshBooks, which sync transactions automatically. Accounts are opened and managed online and in the Novo app for iOS and Android, and Novo has no physical branches.

Novo does not accept cash deposits, so cash-heavy restaurants need another way to handle cash receipts. Alternatives include transferring funds from another bank, receiving payouts from a payment processor, or depositing a money order or cashier's check with mobile check deposit in the Novo app. MoneyGram money orders aren't supported for mobile deposit, and check deposits are subject to limits and holds.

Two more details that matter when money moves: Novo accepts incoming wires in USD only and charges no fee for incoming wires, and Novo Reserves is a budgeting feature within the Novo checking account, not a separate account, in which you can create up to 20 Reserves. Novo does not provide tax, legal, or financial advice, so take the contract questions in this article to your attorney.

What are the key takeaways from the FTC lawsuit against Toast?

On October 29, 2026, the FTC, California, and the attorneys general of seven states accused Toast of charging restaurants fees they did not agree to and making the exit expensive. Toast denies the allegations, and no court has found it liable. Restaurant owners can act now by collecting every vendor contract in one place, setting a calendar reminder ahead of each auto-renewal date, and reconciling vendor charges against deposits every month.

Sources: News Detail Page, illinoisattorneygeneral.gov; Nebraska, FTC, and Partnering States Sue Toast Inc. over Hidden and Unauthorized Fees and Other Unlawful Conduct, ago.nebraska.gov; Toast is sued by the FTC over alleged hidden fees, nrn.com; FTC and States Take Action Against Toast Inc. over Hidden and Unauthorized Fees, Deceptive Subscription and Cancellation Practices and Other Unlawful Conduct, ftc.gov; Complaint, Case No. 3:26-cv-12705 (N.D. Cal.), ftc.gov.

Disclosures

Novo Platform Inc. ("Novo") is a fintech, not a bank. Banking services provided by Middlesex Federal Savings, F.A., Member FDIC. Eligibility subject to final Novo determination.

Novo Reserves is not a separate account. Novo Reserves is a budgeting feature within the Novo checking account. All funds within Reserves remain a part of the overall balance of the Novo checking account.

Novo Platform Inc. strives to provide accurate information but cannot guarantee that this content is correct, complete, or up-to-date. This page is for informational purposes only and is not financial or legal advice nor an endorsement of any third-party products or services. All products and services are presented without warranty. Novo Platform Inc. does not provide any financial or legal advice, and you should consult your own financial, legal, or tax advisors.

This page is for informational purposes only and is not intended to be relied upon as legal, financial, or accounting advice. Please consult your own professional if you have any questions.