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AT&T To Pay $700,000 For Overcharging Consumers 74

Posted by Soulskill
from the two-thousandths-of-a-percent-of-quarterly-revenue dept.
An anonymous reader writes "CNet reports on an agreement between AT&T and the FCC which will require the telecom company to pay $700,000 to the federal government to resolve overcharging complaints. AT&T will also refund charges to customers who were switched from pay-as-you-go data plans to monthly plans after AT&T said they could keep the old plans. 'AT&T has also agreed to an extensive compliance plan (PDF), which includes: consumer notification, training of customer care representatives, and periodic compliance reports to the FCC. AT&T must also conduct additional searches of its records to identify improperly switched consumers and ensure appropriate refunds.'"
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AT&T To Pay $700,000 For Overcharging Consumers

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  • 700,000 dollar (Score:5, Informative)

    by Anonymous Coward on Wednesday November 07, 2012 @09:15AM (#41906461)

    an ink dot on himalayas, when compared to unjust profits of telecom vultures

    • Re:700,000 dollar (Score:5, Insightful)

      by Mitreya (579078) <(mitreya) (at) (gmail.com)> on Wednesday November 07, 2012 @09:57AM (#41906821)

      an ink dot on himalayas, when compared to unjust profits of telecom vultures

      I assume they get to write off 700K as losses when filing federal taxes? Plus another 2-3 million as a cost of locating and refunding the affected customers, so that the penalty is fully offset by a decreased tax liability.

      • by operagost (62405)
        No, they cannot write off a federal court judgement against them as a loss. They might be able to write off the actual refunds.
        • by icebike (68054) *

          The court judgement of 700,000 is less than 1/20th of the hourly intake of AT&T.

          They had revenue of 126,723,000,000 in 2011.
          The number of customers affected by this is also very small in relation to their regular customers.

          So this was a nothing issue, and still is. They have no need to write off any of this, they spend more on advertising every day of the week.

      • by nedlohs (1335013)

        I assure you AT&T does not pay a tax rate of 100%, and hence writing things off as costs does not "fully offset" anything.

  • wow... (Score:4, Insightful)

    by MickyTheIdiot (1032226) on Wednesday November 07, 2012 @09:15AM (#41906469) Homepage Journal

    They'll make enough by lunch time to cover it.

    Big penalty, that...

    • Re:wow... (Score:5, Insightful)

      by Mitreya (579078) <(mitreya) (at) (gmail.com)> on Wednesday November 07, 2012 @09:53AM (#41906787)

      They'll make enough by lunch time to cover it.

      Quoth TFA -- "He added that AT&T had already discovered and corrected the issue by Nov. 2010, and had given refunds to customers who contacted AT&T."

      Whatever their fine is, it should be increase by 100-fold because AT&T discovered the issue 2 years ago, but only refunded customers who contacted them and complained. You'd think that if they discovered unfair customer overcharging, they would refund every affected customer?

  • by Andrio (2580551) on Wednesday November 07, 2012 @09:16AM (#41906485)
    A much simpler and far more effective punishment would be if they were forced to run ads (on TV, magazines, online) to let the public know they were overcharging their customers.

    Fines don't mean crap to billion dollar companies. They need punishments that actually punish them.
    • Re: (Score:2, Interesting)

      by Anonymous Coward

      Like percentage fines. 1% of gross revenue would be $1.1 billion.

    • by drinkypoo (153816)

      A much simpler and far more effective punishment would be if they were forced to run ads (on TV, magazines, online) to let the public know they were overcharging their customers.

      Actually, I have an even better idea. What if every advertisement they published had to carry a disclaimer about the things they'd got caught doing? The text would have to both be legible and no smaller than the smallest informative text that appears elsewhere on the sign. If they get busted enough times, they get like 10% of the board for their actual ad content.

      • The text would have to both be legible and no smaller than the smallest informative text that appears elsewhere on the sign.

        I think you meant "no smaller than the biggeset informative text", otherwise they would certainly game that. And don't forget to specify a contrasting color, and prominent placement otherwise they will pull an Apple on that too.

        • by drinkypoo (153816)

          Well, there should be a legibility standard, where the text has to appear bigger than a certain size at the intended viewing distance at that print size...

    • But that would result in actual punishment, instead of an illusion to pacify the public, which is what these have always been. Forcing them to run ads would be of no use. You would have to scroll down the screen to see it. I say we should apply RICO and asset forfeiture, including their corporate charter privileges and tax breaks. Subject the decision makers to personal liability. Now that would be effective punishment to anybody who wants to stay in business.

      • The normal guy in the U.S. has forgotten that Corporations even have charters and need the government to exist (as they are "legal fictions"). For too many people the corporation was handed down to us from God... no idea of the history or how it came to be or the downright deception that led to them having the same rights of individuals. They complain about "JOB KILLING REGULATIONS!!11!!" out of one side of their mouth while, at the same time, the government is winking at them and saying "you don't have t

        • by mcgrew (92797) *

          The only people hurt by regulations in the U.S. are the people who are actually trying to follow the rules and be good citizens.

          That applies to every law written; from drug laws to road traffic laws to bank robbery to environmental regs to gun laws. Sociopaths don't give a damn about your laws!

    • by jitterman (987991)
      That's a great idea. Another plus - it would likely cost much more to run than the "fine" that was imposed (though admittedly, still a pittance).
    • by Xelios (822510) on Wednesday November 07, 2012 @09:53AM (#41906779)
      Fines would mean crap to companies and individuals alike if they were levied as a percentage of income instead of a flat amount. Is there any good reason why it isn't done this way?
      • by GNious (953874) on Wednesday November 07, 2012 @09:57AM (#41906819)

        I understand that the EU does it that way - which is why everyone is whining that they are being too cruel to companies with the billion-dollars fines.

      • by Mitreya (579078) <(mitreya) (at) (gmail.com)> on Wednesday November 07, 2012 @10:29AM (#41907141)

        Fines would mean crap to companies and individuals alike if they were levied as a percentage of income instead of a flat amount. Is there any good reason why it isn't done this way?

        Yes! Yes, there is [stopthecap.com]. According to this article, AT&T paid zero taxes (received subsidies, even) in 2011, which means they probably had near zero official income in 2011.
        Maybe you can't pull such crap in UK, but in US percentage of corporation income is not the way to go.

        • It is easy for a U.S. corporation to have very good official income and not pay taxes or even have a negative tax rate. This is most prevalent when you look at the property tax debacles that happen in just about every state (but, oddly, are NEVER talked about in the media).

          That's why people who have actually read books see the arguments about "high corporate tax rate" and laugh their asses off.

        • an easy fix is to set things to GROSS income that is the company took in XBillion dollars in total (before any corrections) so That number is what you set the fines to.

        • I'm skeptical that there isn't a metric you could use that would be better than taxable income. Net worth of the company for instance.
        • by Anonymous Coward

          And that is why you base the fine on revenue, not profit.

    • by Murdoch5 (1563847) on Wednesday November 07, 2012 @10:00AM (#41906847)
      The best punishment ever handed down was to a lady who used the sidewalk to pass a bus, the judge is making her wear a sign which has on it “Only an idiot would drive on the sidewalk to avoid the school bus.”. Read more: http://www.thesun.co.uk/sol/homepage/news/4630315/Woman-to-wear-idiot-sign.html#ixzz2BXro0Llo [thesun.co.uk]
  • by 3seas (184403) on Wednesday November 07, 2012 @09:18AM (#41906499) Journal

    ...not those who were damaged....

    • Funny how these sorts of lawsuits pay to...not those who were damaged....

      It could be worse. The usual penalty in similar cases (at least class action suits and settlements) is that current customers are all sent a coupon worth a discount on some future purchase, one that they likely wouldn't make anyway.

  • by schwit1 (797399) on Wednesday November 07, 2012 @09:34AM (#41906643)

    "AT&T will also refund charges to customers who were switched from pay-as-you-go data plans to monthly plans after AT&T said they could keep the old plans."

    Will these customers be able to get back on the pay-as-you-go data plans?

  • Not pay the federals! Ah!
  • by ceriphim (1530579) on Wednesday November 07, 2012 @09:51AM (#41906765)
    With their 2011 revenue (http://www.att.com/gen/general?pid=22537), they generate roughly $697,615/hour in revenue.

    I take it the FCC isn't familiar with "Old Testament" -style justice...
  • Or just pay it to Mother Government.

  • Don't Believe it (Score:4, Insightful)

    by Murdoch5 (1563847) on Wednesday November 07, 2012 @09:58AM (#41906833)

    training of customer care representatives

    No company has trained customer care, I said it and I stand by it! If AT&T succeeds with this, they will be the first company to ever have trained ( not necessarily qualified ) customer care representatives.

    On a side note and unrelated, I once had an issue with a router where it wouldn't get an IP address from the modem, I called Dlink and the lady on the other end kept saying "I need the IP address of the router sir", I kept telling her it didn't have one and that was the issue, she had NO idea what I was saying and kept repeating the same phrase. Got to love trained customer care! Thats not even my best story!

    • Since it is in their best interest to scam the system any way they can (thanks to the ubiquitous "shareholder value" excuse) and there is virtually no deterrence to doing so (they'll get what equates to a $5 fine for us working stiffs) then there is virtually no chance that they will stand by the agreement.

      In the U.S. there is no incentive to do the right thing EVER.

    • Perhaps she mean MAC address. I can imagine that happening to anyone in the middle of a long dreary shift.

      I worked for a few years as one of the senior network operations guys at a company that provides customer support on behalf of various regional ISPs. This was in Canada, where the expectation when calling tech support is that you will find a fellow human being on the other end of the line, not a weary, disinterested or passive-aggressive drone.

      We didn't run a sweatshop. Most of our senior peopl
      • by Murdoch5 (1563847)
        Well she kept saying IP address but that's beside the point. I still don't believe in having under qualified / trained people on customer care. A lot of the time when you call customer care your not even calling a person in the country you live in. I can't count how many times I've called customer care and I speak to someone in India or China who can barely talk English. If I need to call customer care in the first place then I should at least talk to someone who knows the product inside out and upside
        • I sympathize, but your answer tells me that you're determined to repeat the same failed approach to problem resolution.

          I've told you one way to get out of that. Switch providers, if you can. Switch to a smaller outfit, one in your community, if you can.

          Here's another way. If you're not making reasonable progress, escalate. To do this most effectively, you should proactively record your conversations with the provider and make sure it's accurately timestamped. If you hit someone intelligent and kn
          • by Murdoch5 (1563847)
            Well these were two different situtations. I agree the right course of action is to escalate up the ladder, how ever it still doesn't solve my frustration of having Tier 1 workers who don't know / understand the product. Well in most cases I do end up escalating the issues up ladder myself, I do believe the customer care specialist should know enough to do it themselves. From my experience the first person you talk with is clueless, they read a script and besides what they're reading they can only really
  • What a black swath this will leave on their balance sheets. I'll bet their wrists are still stinging.

  • From: AT&T lobbying weasels
    To: Federal telecom regulators (whores)

    Sorry about that, guys. We know this was a little embarrassing for everyone, and it certainly resulted in some extra work for you. Still, the penalties are chump change, so let us make it up to you by buying lunch. Say, for a week or so, in Monte Carlo?
  • by Anonymous Coward

    Over the top? Maybe. But these people need a higher exposure to risk for the kind of money they make. They also need to pay punitive damages in terms of jail time or money or both for all the wasted time in government and per individual that has not been quantified.

    You start putting a few of them in jail or taking their fucking heads, and this kind of nonsense will stop very quickly.

  • AT&T is an abusive company. I guess they can afford to be that way when new customers are always pouring in with the allure of something new and better. When I moved, I went to the AT&T office to have my DSL service terminated. Their systems were down but I was promised by the rep he would take care of it. After I moved, I went to a different AT&T office to confirm and they said they couldn't help me because the account was set up in another state. I went online. After navigating through w
    • by Khyber (864651)

      You do have recourse - tell the collection agencies they're actively engaging in fraud and if they continue to pursue such a baseless claim they'd better be prepared to pay out of the ass in court. Then you ask directly for their law firm's number.

      They will almost universally stop. Only medical debt collectors are tenacious enough to stand up to a fraud claim.

    • by vovin (12759)

      IF it's already on your credit report. You can NOT remove the mark by paying now.

      If you pay now you are admitting guilt and enriching the collection company that bought the junk paper. AT&T already got paid by the collection agency when they sold the junk paper (your debt, aka the bill).

      Your best recourse is to contact the credit agencies and have the disputed bill noted (for any agency that has it on their credit report).

      For future reference, the only way to keep such crap off your report is to pay *be

  • I'm sure the CEO and COO spend more than that on Coke and Whores last weekend.
  • by Sentrion (964745) on Wednesday November 07, 2012 @12:58PM (#41909041)

    training of customer care representatives

    We at AT&T cannot accept this requirement. Only by not-training our customer care representatives can we ensure the profits that will meet the expectations of our shareholders. By training our customer care representatives we can no longer avoid responsibility and pretend that we didn't know what was going on. Consumers will no doubt mercilessly take advantage of this and pay only the amount(s) they originally agreed to. This penalty, to make us train our customer care representatives, is particularly harsh, and will make us uncompetitive. It is bad for business, bad for the economy, and bad for America.

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