Uber on Thursday agreed to pay $20 million to resolve federal allegations that the online ride-hailing service duped drivers about vehicle financing and inflated how much money they could earn at the company.

"In its advertisements, Uber claims that Uber drivers can earn specific high hourly and yearly earnings. Notwithstanding these representations, in many instances drivers have not earned the high earnings touted by Uber," the Federal Trade Commission alleged in a lawsuit filed in the U.S. District Court for the Northern District of California.

The FTC said in a statement that the settlement will put millions of dollars back in Uber drivers' pockets.

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C. Ryan Barber

C. Ryan Barber, based in Washington, covers government affairs and regulatory compliance. Contact him at [email protected]. On Twitter: @cryanbarber