Bench Customers Data at Risk - Forced Data Handover

Bench Customers Face Data Access Issues After Employer.com Acquisition

Following the unexpected closure of accounting startup Bench on December 27th, and its subsequent acquisition by Employer.com in a rapid sale, Bench’s clientele are discovering challenges in retrieving their financial information.

Several customers have voiced their dissatisfaction with the situation, as reported to TechCrunch.

Recap of the Bench Shutdown and Acquisition

Bench, a Canadian-based startup that had secured $113 million in funding from investors including Bain Capital Ventures and Shopify, ceased operations, leaving numerous businesses without access to vital accounting and tax documentation. Shortly thereafter, an agreement was reached for Employer.com to acquire Bench for an undisclosed sum.

Employer.com, headquartered in San Francisco, concentrates on payroll and employee onboarding processes, differing from Bench’s specialization in accounting and tax services.

Employer.com’s Background

Initially, Employer.com appeared to be a relatively new entity, with CEO Jesse Tinsley having acquired the domain name in November for approximately $450,000. Tinsley also leads other HR-focused businesses, such as Recruiter.com and BountyJobs.

However, further investigation by TechCrunch revealed that Employer.com operates as a doing business as (dba) for Recruiting.com Ventures. Tinsley obtained Recruiter.com in 2023, taking the formerly Nasdaq-listed company private, according to Employer.com CMO Matt Charney. This parent entity has been in operation since 2015.

Concerns Regarding Employer.com’s Expertise

Bench characterized Employer.com in its consent form as a “highly successful and profitable organization with a proven track record of acquiring and running companies over the past decade.” Charney confirmed the company’s profitability. Nevertheless, some Bench customers are apprehensive about Employer.com’s limited experience in accounting and tax matters.

One Bench customer explained to TechCrunch that when requesting records spanning two out of his five years as a client, he was required to “hit a consent button.”

“The wording on that page indicated that consent meant forfeiting any refunds, which I considered a manipulative tactic,” he stated. The company subsequently modified the page to remove the refund disclaimer.

The customer successfully obtained a refund from his credit card company for two years of prepaid service. Despite this, he expressed disappointment with the handling of the situation.

“I had previously recommended their services and had clients utilizing them, which is now regrettable,” he added.

Data Access Contingent on Consent

Another long-term customer reported that Employer.com presented Bench users with a choice: accept updated terms to continue service, or discontinue service and download data. He opted for the latter.

“Shortly after, I received a notification stating that accepting the terms was still necessary to export the data,” he said. “While I ultimately accepted to resolve the issue, it felt questionable to compel users to do so in order to access their own information. Agreeing to these terms automatically enrolled me in continuing Bench services.”

Essentially, it appears that Bench customers were obligated to consent to data transfer to Employer.com in order to gain access to their records.

The customer, a Bench client for a decade, decided against remaining a client, citing concerns that Employer.com “does not appear…familiar with effectively managing this type of business.” He is currently exploring alternative providers.

Privacy Policy Concerns

Michelle Gayle, a business advisor with Core Insights Group, stated she understood her company could download its data after consenting to specific terms.

She informed TechCrunch that the company revised its consent page, removing the option to decline data transfer to Employer.com.

“They have obscured the fact that this new ‘acknowledgement’ is equivalent to the previous ‘consent,’ and it is supported by a privacy policy that is inadequate for the financial services provided by Bench.com,” she said. “Furthermore, their offer of discounts on recruitment services seems insensitive given the circumstances.”

Gayle described Employer.com’s privacy policy as inadequate.

“This policy does not address the safeguarding of financial data, and my attempt to contact legal@employer.com regarding this deficiency resulted in a bounce-back message,” she added.

Similar complaints are being shared on a Reddit thread by numerous disappointed former customers.

Employer.com’s Response

Employer.com maintains that customers can access their data by providing consent, which grants Employer.com authorization “to make their data available for download.”

“Following consent, customers can manage their data, including downloading, deleting, or continuing services on the platform,” Charney explained to TechCrunch. “Once consent is granted, they can choose to continue with the same contract and pricing or cancel their service.”

Regarding refund requests for prepaid services that Bench will no longer provide, Charney advised contacting the bankruptcy trustee for Bench Accounting Inc. or requesting a refund through Stripe.

Following publication, Charney provided this additional statement regarding data consent: “To put it simply, the only way for customers to access their data is to grant Employer.com permission to access it, as the only other entity currently possessing that data no longer exists and is undergoing bankruptcy proceedings. Without consent, they will not be able to retrieve their data. This is the only method we have to ensure that all Bench customers, regardless of whether they choose to remain clients, can access their records. We will immediately delete the data of any user who chooses to opt out after downloading it, and will not retain any of their information.”

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