Verizon to refund $50 million, may face fine for delay

Woman walks in front of a Verizon Wireless storeVerizon Wireless will refund $50 million to 15 million customers for unauthorized mystery cell phone data charges and the Federal Communications Commission is saying, "What took so long," and maybe, "That's not enough."

As Verizon announced the refunds on Sunday night -- Verizon Wireless has 92 million customers -- a top FCC official issued a statement saying that the agency had been probing the overcharges for 10 months and questioning the company's explanation for not acting sooner in response to customer complaints. The statement hinted the FCC may fine the company for failing to act sooner.

"We're gratified to see Verizon agree to finally repay its customers. But questions remain as to why it took Verizon two years to reimburse its customers and why greater disclosure and other corrective actions did not come much, much sooner," said Michele Ellison, chief of the FCC's Enforcement Bureau in a statement.

"The Enforcement Bureau will continue to explore these issues, including the possibility of additional penalties, to ensure that all companies prioritize the interests of consumers when billing problems occur," she added. "Consumers have a right to receive straight bills and to get straight answers when they question them."

The mystery charges for "data access" started appearing on phone bills two years ago. Consumers with Verizon cell phone service complained they were charged for data access at times their phones were off or when they inadvertently opened their phone's web browser but immediately shut it down.

Verizon Wireless in a statement Sunday from deputy general counsel Mary Coyne acknowledged that the customers shouldn't have been charged and said it will refund the charges. The average customer getting a refund will get a check of $2 to $6, but some will get larger checks, the company said.

Verizon said the customers impacted were those without data plans, who were wrongly charged for data access. It blamed the majority of the problem on "minor data exchanges caused by software built into their phones" but also problems came from customers accidentally accessing the web from their phones.

"We have addressed these issues to avoid unintended data charges in the future," the company said, adding that the company issue credits to customers "from time to time based on regular review and monitoring."

"When we identify errors, we remedy them as quickly as possible," Coyne's statement said. "Our goal is to maintain our customers' trust and ensure they receive the best experience possible."

The announcement comes as the FCC increases its scrutiny of phone billing. In May the agency announced it was examining what more carriers could do to better notify customers they are near going over their normal service before sending them "sticker shock" bills. The commission is due to vote later this month to start writing the requirement into FCC rules.
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