AT&T ordered to refund 'grandfathered' customers
AT&T has agreed to hand back $700,000 to customers who were switched to the company's monthly wireless data plans despite promises that they could remain on their existing pay-as-you-go data plans.
The customers concerned - known as 'grandfathered subscribers' - could see refunds of as much as $25 to $30 a month for the period they were switched.
In November 2009, AT&T started forcing first-time smartphone subscribers to enrol in monthly data plans - and did the same for those who were upgrading their handsets. Consumers complained, prompting the FCC to launch an investigation last year.
"Today’s action sends a clear signal that wireless carriers can’t wrongfully charge consumers," says FCC chairman Julius Genachowski.
"These strong FCC accountability measures will ensure customers are not over-charged. I am pleased that AT&T is taking the appropriate steps to resolve this issue."
AT&T smartphone customers who had pay-as-you-go data plans, or who had disabled network data, and kept their old phones had the option to keep their existing data plans when the company made monthly plans mandatory.
But some consumers who replaced these phones under warranty or insurance, or who moved house, were switched to the monthly plans - even though AT&T had said the grandfathering policy would continue to apply in these situations.
AT&T will now have to make a voluntary payment of $700,000 to the US Department of Treasury, as well as offering refunds to individual customers. It's also agreed to an extensive compliance plan, which includes consumer notification, training of customer care representatives, and regular compliance reports to the FCC.
"This Consent Decree puts precious dollars back in the pockets of consumers—where they belong," says Michele Ellison, chief of the FCC’s Enforcement Bureau.
"We strongly encourage AT&T subscribers to check their bills closely and contact the company if they spot any overcharges related to wireless data."