FCC Completes “Mystery Fees” Investigation of Verizon Wireless Data Charges
This order stands in stark contrast to the nominal CPNI settlements, odd refund provisions and low-ball forfeiture penalties we’ve discussed in this blog. Today, the FCC announced an eye-popping $25 million settlement with Verizon Wireless in its investigation of Verizon’s unauthorized billing of wireless data charges. The so-called “mystery fees” investigation stemmed from allegations that Verizon Wireless was charging customers $1.99 per megabyte usage charges for data sessions that consumers did not initiate or were not aware of. According to the FCC, many of the charges were caused by mobile applications accessing the Internet, third party-initiated data transfers and failures of Verizon’s Internet access and billing. The FCC boasts that this is its largest-ever settlement and consumer refund action.
A few weeks ago, Verizon announced $50 million in customer credits related to the “mystery fee” charges. At the time, the FCC confirmed it was investigating, but it withheld its powder about its own enforcement action. Today, the FCC announced a settlement and the $25 million “voluntary payment” by Verizon Wireless. Click here for the press release and text of the consent decree.
The FCC highlighted the following provisions in its press release:
- $25 million voluntary contribution to the federal treasury;
- minimum $52 million in consumer refunds;
- cessation of billing for “unauthorized charges”;
- revised consumer disclosures and a “data block” service option.
In addition, the consent decree contains training and compliance monitoring provisions over two years.