The carriers are accused of creating ads that mislead customers about their ‘unlimited’ data plans and ‘free’ phone offers.
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Verizon, AT&T, and T-Mobile will pay a combined $10.22 million to a group of states to settle claims that the carriers lied to customers about their “unlimited” plans and “free” phone offers. The settlement, which follows an investigation from a coalition of 50 attorneys general, requires the three companies to make their advertisements more transparent.
Under the terms of the agreement, Verizon, T-Mobile, and AT&T can only advertise their plans as “unlimited” if there are no limits on how much data someone can use during a billing cycle. The ads must “clearly and conspicuously” say that restrictions on speed may apply, as well as specify the amount of data customers can use before triggering the slowdown.
Additionally, the attorneys general went after the allegedly misleading claims Verizon, T-Mobile, and AT&T made in ads promising to “pay” customers to switch carriers. All three companies must now clearly disclose the terms and conditions associated with the offer, including how much a customer will be paid and when they will receive their payment. The carriers must also disclose the requirements customers must meet to receive “free” phone offers, along with any hidden fees.
“AT&T, Verizon, and T-Mobile lied to millions of consumers, making false promises of free phones and ‘unlimited’ data plans that were simply untrue,” New York Attorney General Letitia James says in a statement. “Big companies are not excused from following the law and cannot trick consumers into paying for services they will never receive.”
Verizon, T-Mobile, and AT&T will also have to appoint a “dedicated representative” to field customer complaints. The three companies deny any wrongdoing. “These voluntary agreements reflect no finding of improper conduct and reaffirm the wireless industry’s longstanding commitment to clarity and integrity in advertising so that consumers can make informed decisions about the products and services that best suit them,” Nick Ludlum, the senior vice president of the CTIA, the trade group representing the carriers, tells The Verge.
This isn’t the only scrutiny the three major carriers have faced as of late. Last week, the Federal Communications Commission fined Verizon, AT&T, and T-Mobile almost $200 million over allegations they illegally shared customers’ location data.
