SAN FRANCISCO Nov 6 AT&T Inc has agreed
to pay a $700,000 fine and refund customers who had been
overcharged on smartphone plans, after the Federal
Communications Commission looked into complaints that the No. 2
U.S. wireless carrier may have switched users to costlier
monthly subscriptions without their consent.
The company agreed to return excess charges paid by
smartphone customers who were switched to a costlier, monthly
subscription plan from a "pay-as-you-go" system, the commission
said in a statement on Tuesday.
An AT&T spokesman said fewer than 0.03 percent of their
customers had been mistakenly switched, an error discovered in
2010. It then reimbursed those who contacted the company.
"Based on a review of our refund process, we believe a vast
majority of those customers affected by the billing error have
already been made whole," the spokesman said.
The FCC began its investigation only last year. The switch
resulted in additional fees of as much as $25 to $30 a month
depending on usage, the industry regulator said.
This "puts precious dollars back in the pockets of consumer
-- where they belong," said 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."
AT&T made monthly plans mandatory for first-time and
upgrading customers in September 2009, while existing customers
could stick with "pay-as-you-go" under a so-called grandfather
clause. But according to the commission, some existing users who
replaced phones through warranty or moved homes were switched to
the more expensive programs.
As part of an agreement with the FCC, AT&T promised to
better train its customer representatives, keep uses notified of
changes, and go through its records to turn up potentially
overcharged customers eligible for refunds.