Verizon to refund $30-$90m in 'mystery fees'
As FCC investigation continues
Verizon will refund between $30 and $90 million to customers for "mystery fees" charged to their wireless accounts — but the US Federal Communications Commission says that the paybacks won't end their investigation into the US's largest wireless provider's billing practices.
"As we reviewed customer accounts," said Verizon counsel Mary Coyne when announcing the payback Sunday, "we discovered that over the past several years approximately 15 million customers who did not have data plans were billed for data sessions on their phones that they did not initiate."
According to Coyne, "The majority of the data sessions involved minor data exchanges caused by software built into their phones; others included accessing certain web links, which should not have incurred charges."
The 15 million overcharged customers will receive credits on their October or November bills of between $2 and $6 apiece; customers who are no longer on a Verizon plan will get refund checks for the appropriate amount. Coyne did note, however, that "some will receive larger credits or refunds."
"The FCC Enforcement Bureau began looking into this matter ten months ago after reports from consumers about these mystery fees," said FCC enforcement bureau chief Michele Ellison in a statement.
"We're gratified to see Verizon agree to finally repay its customers," Ellison said. "[But[ questions remain as to why it took Verizon two years to reimburse its customers and why greater disclosure and other corrective actions did not come much, much sooner."
And Verizon isn't off the hook quite yet. "The Enforcement Bureau will continue to explore these issues," said Ellison, "including the possibility of additional penalties, to ensure that all companies prioritize the interests of consumers when billing problems occur."
Verizon may not be alone in its dip into FCC hot water — The Washington Post reports that the commission declined to comment about whether its investigation was also targeting AT&T, T-Mobile, and Sprint. ®
So, to explain (since the article doesn't), without a data plan or data block (which blocks all data as the name implies...) the cost for pay-per-use is $1.99/MB. But, that means that 1KB of usage bills at $1.99 -- thus the mystery fees. Why don't they just make the first MB free, to cover accidentally bumping the browser button, or random small data uses of apps? Well, I guess the "$30-90 million" says it 8-)
Goes to show
It is no surprise to me that this happened to so many and as long as it did.
In the U.S., we get these "mystery fees" on any phone product whether it be lan line or mobile. The phone companies can't even explain them when ask what they are, but refuse to remove them.
That's sad when you pay for something and you don't even know what it is and have no way of not paying it.
I guarantee many companies have been in meetings and watching this with a microscope because they could be next.
Ah, but see...
The services WERE delivered, and at the contracted rate. The problem is that the services were not explicitly *requested* but were instead invoked as an unintended consequence of a user's action, without explicit notice of the consequential charge.
As for why this is the FCC and not another agency, it does come down to that "Communications" aspect. FCC handles communications, SEC handles financials (mostly), FAA handles most things to do with airplanes even if it's how an airline handles things on the ground, FDA hands stuff wot is food or drugs, etc. FTC handles just what's left because they do not have the resources to cover specialized areas of knowledge.