For much of the last decade, wireless carriers have sold “unlimited” data plans with a wide variety of very obvious and annoying limits. And for just as long, regulators have doled out little more than ineffective wrist slaps in a bid to keep carrier marketing departments honest.
The latest case in point: AT&T this week struck a $60 million settlement with the FTC for repeatedly lying to consumers about the company’s unlimited wireless data plans.
Starting sometime around 2011, the FTC says AT&T began selling “unlimited” mobile data plans without disclosing they had very real, significant limits. In its complaint, the FTC says that AT&T would throttle customer mobile data connections by as much as 90 percent after customers used as little as two gigabytes of data—a far cry from “unlimited.”
“AT&T baited subscribers with promises of unlimited data, trapped them in multi-year contracts with punishing termination fees, and then scammed them by choking off their access unless they moved to a more expensive plan,” FTC Commissioner Rohit Chopra said in a statement.
The FTC sued AT&T in 2014 for misleading consumers, and AT&T has spent years trying to wiggle out of the lawsuit by claiming the FTC lacked the authority to hold AT&T accountable. The FCC levied a $100 million fine against AT&T in 2015 for the same behavior.
Under the terms of the new FTC settlement, customers who signed up for an “unlimited” AT&T data plan before 2011 will automatically receive “partial refunds” in the form of a check mailed to their address. AT&T also has to clearly disclose any limitations to its unlimited data plans via the company’s website.
“The disclosures need to be prominent, not buried in fine print or hidden behind hyperlinks,” the FTC said.