Firm claims Verizon failed to properly refund consumers for wrongful data charges
A law firm is claiming that a 2010 agreement between the FCC's Enforcement Bureau and Verizon Wireless (NYSE:VZ) in which Verizon agreed to refund customers $52.8 million in wrongful charges was "woefully" inadequate and that the amount consumers were overcharged was closer to $300 million.
In 2010 the FCC said that it had reached a settlement with Verizon in which Verizon agreed to refund customers who were wrongly billed $1.99 in data charges from 2007 to 2010 on their cell phones. Verizon calculated those charges to equal $52.8 million and said it would refund those customers and make a "voluntary contribution" to the U.S. Treasury of $25 million.
At the time, the FCC said that the settlement was the largest in the FCC's history. In addition, the commission said it had spent 10 months investigating the data charges.
However, law firm Smithwick & Belendiuk, P.C., which filed a Freedom of Information Act request, claims it discovered that the FCC's Enforcement Bureau did not verify Verizon's $52.8 million calculation, and further, the bureau withheld from the public its two letters of inquiry and numerous responses from Verizon.
The law firm claims it received documentation that shows Verizon was aware that it was overcharging its customers even as it was denying there was a problem. Further, the firm said that the documents reveal that the $52.8 million refund was only a small fraction of the wrongful charges.
"It appears from the new material that the overcharging of customers totaled approximately $300 million dollars, rather than $52.8 million that Verizon Wireless represented to the public and the FCC was a 'full refund,'" the firm said in a release.
A Verizon Wireless spokesman said the allegations are without merit.
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Update: This story was updated July 3 to include the comment from a Verizon Wireless spokesman.