Cuomo Forges Settlement With Symantec And Mcafee Over Automatic Subscription Renewals

 

NEW YORK, NY (June 10, 2009) - Attorney General Andrew M. Cuomo today announced a settlement with computer security software vendors Symantec (NYSE: SYMC) and McAfee (NYSE: MFE) after the companies renewed customers’ software subscriptions without the customers’ knowledge or authorization. Under the Attorney General’s settlement, both companies will make detailed disclosures to consumers about subscription terms and renewal, and each will pay $375,000 in penalties and costs.

"Companies cannot play hide the ball when it comes to the fees consumers are being charged," said Attorney General Cuomo. "Consumers have a right to know what they are paying, especially when they are unwittingly agreeing to renewal fees that will not appear on their credit card bill for months. Symantec and McAfee - two of the nation's largest vendors of computer security software - will now have to be clear and up-front with their customers when it comes to renewal fees. In other words, no more hide the ball with renewal fees."

Symantec and McAfee both offer a wide range of products to individuals and businesses to protect computers from internet threats such as computer viruses and spyware. Both companies regularly revise and update their software to combat the latest security threats, and they provide these updates to their existing customers. Customers who buy Symantec or McAfee software are only entitled to a limited “subscription” to these updates, usually for a period of one year. After this period, customers must pay for a renewal subscription in order to receive new software updates.

The Attorney General conducted an extensive investigation into the online marketing and sales practices of Symantec and McAfee. The Attorney General’s investigation found that the companies failed to adequately disclose to consumers that subscriptions would be automatically renewed and that consumers would be charged for subsequent subscriptions. Information about automatic renewal charges was not clearly disclosed, but was instead hidden at the bottom of long webpages or in the fine print of license agreements.

The Attorney General’s office received complaints from customers who had bought Symantec and McAfee software over the internet and whose credit cards were later charged for “renewal subscriptions” without their knowledge or consent. In addition, the investigation also revealed that both Symantec and McAfee made it difficult for consumers to contact the companies to opt out of automatic renewal or to request refunds for unauthorized credit card charges.

Under the terms of the Attorney General’s settlement, Symantec and McAfee will clearly disclose to consumers any automatic renewal program and provide an easy, transparent, and automated means to opt out of renewal. The companies will provide electronic notification to consumers before and after renewal of the subscription and will provide refunds to consumers who request them within 60 days of being charged. The companies will clearly disclose the length of time that they will continue to support and provide updates to any purchased software. Symantec and McAfee will also pay a combined $750,000 to the Attorney General’s office to settle all claims.

Symantec and McAfee are the nation’s largest and second-largest providers of consumer security software, respectively.

The investigation was handled by Assistant Attorneys General Carolyn Fast and Clark Russell, with assistance from Investigator Vanessa Ip, under the direction of Chief of the Internet Bureau Justin Brookman and Deputy Attorney General for Economic Justice Michael Berlin.

 

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