Frontier Communications will provide money and services worth more than $60 million and rework policies and practices to settle an investigation by Connecticut’s Attorney General and Department of Consumer Protection into hidden charges and other allegations.
The investigation included a review of more than 1,400 consumer complaints that claimed such things as charges for equipment already returned, charges that exceeded promised rates and charges that continued after service cancellation, according to the press release. Poor Internet quality was also a concern.
Since emerging from bankruptcy with a new management team, Frontier has acknowledged past performance and quality issues and appears to be trying to put the past behind it as it embarks on a ‘Gigabit America’ strategy. This probably won’t be the last settlement of its kind.
Terms of the Frontier hidden charges settlement include:
- Termination of a $6.99 monthly “Internet Infrastructure Surcharge” which cost about $84 per year and an estimated $16 million statewide last year.
- Investment of $42.5 million over the next 3.5 years to upgrade existing, outdated DSL internet service to fiber internet. At least half of those upgrades are to be made in economically distressed communities, urban and rural. The deployment is expected to bring high-speed and more reliable internet to as many as 40,000 families.
- A 45-day period for customers to decide whether to transition to fiber internet, protections against early termination or disconnection fees if they elect to cancel Frontier service, access to new customer promotional rates and information about Internet subsidies through the FCC’s Affordable Connectivity Program (ACP).
- A $1 million payment to the state and $200,000 in credits and refunds to consumers who filed complaints starting in 2019.
- A list of accountability measures for the next six years, including new price and billing disclosures, advertisement disclosures that address the company’s DSL representations, delivery of promised speeds or options for consumers who do not receive promised speeds, assurances of transparency and fair cancellation and equipment return processes. The Office of the Attorney General has the right to seek $6 million in penalties if the conditions are not met.
Frontier’s documented problems extend far beyond Connecticut. In May 2021, the Federal Trade Commission and attorneys general from Arizona, Indiana, Michigan, North Carolina and Wisconsin and the district attorneys’ offices of Los Angeles and Riverside counties in California alleged in a lawsuit that the company had charged customers for more expensive and higher speed DSL services than it provided.
The company has acknowledged past problems. At the Cowen 8th Annual Communications Infrastructure Conference last month, CFO Scott Beasley said that the company had to “rebuild trust with investors, with equity holders, debt holders, regulators, government officials” as it looks to the future.
