Attorney General Cuomo's Office Requires Rochester's Frontier Communications To Refund Early Termination Fees To Consumers

ROCHESTER, N.Y. (October 5, 2009) - Attorney General Andrew M. Cuomo today announced that his office has reached an agreement with Rochester-based Frontier Communications, Inc. over its failure to properly notify consumers about substantial early termination fees for its services.

In January 2009, Attorney General Cuomo’s Office began investigating Frontier Communications and its subsidiaries after receiving dozens of complaints from consumers who were unexpectedly charged early termination fees.

“Frontier failed to spell out in its contracts the existence of costly fees,” said Attorney General Cuomo. “The company is now fixing the issue by providing written notices of these fees and paying back consumers who were wrongfully charged.”

Frontier, located on South Clinton Avenue in Rochester, provides high speed broadband Internet service (FrontierHSI) and local and long distance telephone service. Between January 2007 and September 2008, Frontier sold bundles of various services under one-, two- or three-year agreements known as Price Protection Plans that offered a lower rate than month-to-month service as well as a promise that the subscription rate would not increase during the term of the plan. However, Frontier charged early termination fees to consumers who terminated a service before the end of the term. These fees typically ranged between $50 and $400, depending on the contents and services included in the package.

The Attorney General’s investigation determined that consumers who purchased one-year bundle agreements were never provided with written notice of the term or the existence of an early termination fee. The investigation also uncovered that consumers were not notified in their monthly billing statement that their agreements contained early termination fees. Therefore, many consumers first learned about the fee only after they cancelled their service with Frontier and the charge appeared on their final bill.

In at least one instance, Frontier automatically re-enrolled a consumer to a term commitment after the initial term expired and then charged an early termination fee when she cancelled after the initial term.

Through an agreement with Attorney General Cuomo’s Office, Frontier must pay up to $50,000 in refunds and credits of early termination fees paid by eligible consumers who filed complaints prior to December 31, 2008. The company has provided the Attorney General’s Office a list of eligible refund and credit consumers that have been identified.

Other consumers who believe they are eligible for a refund or credit may submit a claim to the Attorney General’s Office by December 21, which will review the claims and act as the final arbiter for eligibility for reimbursement. Consumers wishing to file a complaint can download a claim form from www.ag.ny.gov. Consumers may also call the Attorney General’s Rochester Regional Office at 585-327-3240.

Frontier must also pay $35,000 in fees and costs. Frontier will send written notices to all customers who subscribe to new services regarding early termination fees. The company will not collect any such fee until after the notice has been sent. Frontier must also include a written notice of the term of any service agreement on consumers’ monthly billing statement for any agreement with an early termination fee.

The case was handled by Assistant Attorney General Benjamin Bruce under the supervision of Assistant Attorney General-in-Charge of the Rochester Regional Office Debra Martin.


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