The Federal Trade Commission (FTC) said AT&T will pay $60 million to resolve the 2014 case of ‘fake’ unlimited data plans.
The FTC initially brought the case against the carrier back in 2014, stating that customers experience slow data speed if they used too much data. However, the carrier claimed that their data plans are unlimited. According to FTC, this misleading marketing tactic cost customers more money.
In the lawsuit, the commission has indicated how AT&T failed to disclose data-capping practices and fooled its 3.5 million customers. The carrier fired back saying that they have mentioned the speed caps via customer bill notices and press release.
“AT&T’s bait-and-switch scam is a good window into the many harms that result from dominant companies operating without the discipline of meaningful competition. Their market power, financial resources, and one-sided information give them license to ignore their own contractual obligations while aggressively enforcing every little clause in the fine print,” said FTC Chairman Rohit Chopra.
Customers affected can get a partial refund, only at a little amount, but it still counts.
Last year, the company also used an argument, claiming that the net neutrality only applied in 2015, and the authority that regulates mobile carriers is FCC and not FTC. However, the court turned down the argument, which led to the $60 million settlement.
Tech analysts claim that the settlement is just coins to the carrier giant, and it won’t give justice to their wrongdoing. However, for the FTC, the settlement amount is enough to prove that the watchdogs are working and that companies need to take a step back in committing any unfair practices. Additionally, this news is believed to put pressure on the executives in prioritizing profits over the welfare of customers.
The bait-and-switch scam isn’t the settlement made by the carrier. Back in 2015, the company was also criticized for the data breach of more than 278,000 customer accounts.
AT&T paid $25 million in settlement for the data tampering of accounts by Mexico, Colombia, and the Philippines call center employees. According to the Federal Communications Commission, the employees were able to get the personal information of customers and tried to unlock AT&T mobile phones.
The $25-million civil penalty was the most significant privacy and data security enforcement handled by the FCC. It was back in April 2015 when the carrier pleaded guilty and arranged the settlement.