Sprint To Pay $2.95 Million Penalty for Violating Fair Credit Reporting Act, FTC Announces
Sprint will pay $2.95 million in civil penalties to settle FTC charges the company “failed to give proper notice to consumers who were placed in” an Account Spending Limit “program for customers with lower credit scores and charged an extra…
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monthly fee” of $7.99 in addition to cellphone and data services charges, an FTC news release said Wednesday. “Sprint failed to give many consumers required information about why they were placed in a more costly program, and when they did, the notice often came too late for consumers to choose another mobile carrier,” FTC Consumer Protection Bureau Director Jessica Rich said. In addition to having to pay a $2.95 million penalty for violating the Risk-Based Pricing Rule, the FTC is also requiring Sprint to abide by the rule’s requirements in the future; provide the required notices to consumers within five days of their signing up for Sprint service or by a date that gives them the ability to avoid recurring charges like those in the Account Spending Limit program; and send corrected risk-based pricing notices to consumers who received incomplete notices from the company, the release said. The commission vote to authorize FTC staff to refer the complaint to the Justice Department and to approve the proposed stipulated order was unanimous. The DOJ submitted the proposed order on behalf of the FTC to the U.S. District Court for the District of Kansas on Wednesday. The order is subject to court approval, the release said.