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Tuesday, October 15, 2019

Maryland AG reaches prepaid calling card settlement with AT&T

By Bryan Cohen | Dec 30, 2013

BALTIMORE, Md. (Legal Newsline) - Maryland Attorney General Douglas Gansler has announced a settlement with AT&T that resolves allegations that consumers were deceived about the amount of time provided on its calling cards.

Under terms of the settlement, AT&T will pay $100,000 to the state and provide $125,000 in prepaid calling cards to Gansler's office. The cards will then be distributed to military installations in Maryland or nonprofit organizations that provide services and support to active duty or veteran members of the armed forces and their families.

"Our troops make so many sacrifices protecting our freedoms at home and abroad, we wanted this settlement to include a token of gratitude that will enable them to stay in touch with their family and friends throughout the year," Gansler said. "Consumers need to know up front what they're getting for their money when they purchase a product. This case was an example of what you see isn't always what you get."

Between 2007 and 2013, AT&T's prepaid cards prominently displayed the number of minutes of calling time that they supposedly deliver. Small print, however, contained stipulations indicating that in-state and international rates may be higher and that the display number may only apply for state-to-state calls.

A disclaimer on the back of the packaging attached to the calling cards indicated that three minutes were deducted for every actual minute of call time for in-state calls placed within Maryland. As many as eight minutes were deducted for some states.

Gansler's Consumer Protection Division alleged that advertising a specific number of minutes on the face of the card "had the capacity, tendency or effect of misleading consumers."

The settlement prevents AT&T from misleading or deceiving calling card consumers in other ways while providing that cards must clearly and visibly state altered rate structures or other reasons that it will not deliver the advertised number of in-state call minutes.

Regulations issued by the Federal Communications Commission in July require state public utility commissions to have "access charges" for both in-state and intrastate calls on par with each other. This lead AT&T to voluntarily stop deducting more minutes for in-state calls.

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