Verizon to Pay More Than $25M for Hitting Consumers With ‘Mystery Fees’

WASHINGTON, October 28, 2010 – The Federal Communications Commission’s Enforcement Bureau hit Verizon Wireless with a record $25 million payment to the government for mystery fees the company charged its customers during the last several years.

In addition to Verizon’s payment to the U.S. Treasury, the company will refund a minimum of $52.8 million to approximately 15 million customers and ensure that consumers are no longer charged these fees.

“Mystery solved: today’s settlement with Verizon Wireless is about making things right and putting consumers back in the driver’s seat,” said Michele Ellison, chief of the FCC’s Enforcement Bureau. “Today’s settlement requires Verizon Wireless to make meaningful business reforms, prevent future overcharges, and provide consumers clear, easy-to-understand information about their choices. I am gratified by the cooperation of the Verizon Wireless team in the face of these issues, and pleased they are taking the high road.”

The bureau began investigating Verizon Wireless in January after large numbers of consumer complaints and press reports about unexplained data charges.  The investigation focused on “pay-as-you-go” data fees — charges of $1.99 per megabyte that apply to Verizon Wireless customers who do not subscribe to a data package or plan.

The investigation found that approximately 15 million of these pay-as-you-go customers were or may have been overcharged for data usage over the course of three years, from November 2007 to the present.

“Today’s consent decree sends a clear message to American consumers: The FCC has got your back,” said FCC Chairman Julius Genachowski. “People shouldn’t find mystery fees when they open their phone bills, and they certainly shouldn’t have to pay for services they didn’t want and didn’t use. In these rough economic times, every $1.99 counts.”