Verizon (NYSE: VZ) will pay $1.375 million to settle a complaint by Maryland customers who say the company misrepresented FiOS costs. The telco also agreed to pay a $250,000 state penalty and $75,000 in costs.
The settlement puts an end to a six-year-old investigation by the state's Consumer Protection Division into consumer complaints that Verizon improperly charged termination fees or had "inadequately disclosed" equipment costs required to receive FiOS services, the attorney general's office said in a Baltimore Sun story.
"Verizon's activities when it was rolling out FiOS established it as one of our office's biggest complaint generators," Attorney General Douglas Ganser said in a statement carried by the publication. "I'm pleased that Verizon is changing its marketing practices to accurately reflect the total cost of its service and that a significant number of consumers will receive restitution as a result of this agreement."
Customers had complained that Verizon did not honor promotional deals offering televisions and gift cards, failed to clearly explain equipment fees and charged early termination fees for customers who canceled because they didn't receive what they expected, the story said.
As part of the deal, Verizon did not admit to violating Maryland laws but agreed to advertise the cost of its services more accurately.
Verizon spokesman Harry Mitchell told the newspaper that the company's customer service has improved since it started FiOS in 2008 and has addressed "many of the issues raised by the Consumer Protection Division."
"While Verizon's advertising practices complied with all laws and regulations, it's in the best interest of all parties for us to resolve this long-running matter so that we may continue our focus on providing customers with a superior product and a good customer experience," Mitchell said.
Verizon, the newspaper said, reached a similar deal in New Jersey in 2009.
- The Baltimore Sun has this story
Verizon, New Jersey regulators reach settlement on wireline broadband commitment
FiOS settlements cost Verizon more than $500 million
Verizon pressured to expand FiOS in New Jersey