The Federal Communications Commission recently slapped mobile carrier AT&T with a fine of $100 million. The reason behind the fine is AT&T’s caps on unlimited data plans.
AT&T accused of misleading customers
The FCC accuses the company of misleading customers into believing unlimited data plans were truly unlimited. The government agency also reported that AT&T’s capped speeds were significantly slower than the carrier’s advertised speeds.
AT&T’s representative claimed the company is doing everything it can to dispute the FCC’s claims. The representative added:
“The FCC has specifically identified this practice as a legitimate and reasonable way to manage network resources for the benefit of all customers, and has known for years that all of the major carriers use it. We have been fully transparent with our customers, providing notice in multiple ways and going well beyond the FCC’s disclosure requirements.”
FCC fights AT&T
AT&T must prove the FCC’s claims are wrong. If the company proves this successfully, the fine could be reduced. The government agency maintains that AT&T is pulling in a significant amount of profits with its deceptive actions. The FCC’s enforcement bureau chief, Travis LeBlanc, says unlimited should mean unlimited. The commission aims to hold companies accountable for not disclosing all the details about their data plans.
The FCC is a lot like the Federal Trade Commission as it aims to fight companies that are believed to be ripping off customers. The FTC often enforces rules against deceptive advertisements. It also hopes to refund customers who were tricked with unlimited data packages. That case is still in court in the State of California.
In the earlier part of the year, prepaid phone service TracPhone had to pay the FTC over $40 million over a similar issue. Mobile carriers are sometimes subject to scrutiny over allegedly deceptive financial matters.