State Announces $10.25 Million Settlement with Mobile Carriers Over Deceptive Ads

Attorney General Michelle Henry announced on Thursday that Pennsylvania has reached a $10.25 million settlement with several major mobile service providers.

The settlement addresses misleading advertisements about “free” phones and “unlimited” data plans. This agreement involves AT&T, Verizon Wireless, Cricket, and T-Mobile, and covers 50 jurisdictions.

Under the terms of the settlement, these companies must change how they advertise. They are required to clearly state any conditions and fees and must train their customer service staff to follow these new guidelines. Pennsylvania will receive more than $260,000 to cover the costs and fees from the lawsuit.

“The demand for mobile devices is high, and Pennsylvanians deserve accurate information about the costs when they make financial decisions,” Henry says in a statement announcing the settlement.

She noted that the misleading ads have been a significant issue, with promotions offering free devices that had hidden costs and unlimited data plans that had undisclosed limits.

The settlement outlines specific changes the carriers must implement:

• They can only advertise data plans as “unlimited” if there are truly no limits on the amount of data used and if they clearly explain any speed restrictions.
• Promotions that pay consumers to switch carriers must fully disclose the types of fees covered and the conditions under which consumers receive these payments.
• Offers of free phones or services must clearly state all the terms a consumer must meet to receive the deal.
• Claims that consumers will save money must be based on accurate comparisons with similar services, and any differences must be clearly stated.

Additionally, each carrier must appoint an employee to handle complaints related to these issues and ensure that customer service representatives are trained to comply with these new standards.

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