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Charter-Spectrum to pay New York State customers $174 million for defrauding internet subscribers

Posted at 8:34 AM, Dec 18, 2018

NEW YORK, N.Y. (WKBW) — Charter-Spectrum is set to pay a record amount of money in a consumer fraud settlement with the New York Attorney General.

The company has agreed to pay certain customers $174.2 million over allegations it defrauded internet subscribers. The Attorney General's office said it's believed to represent the largest-ever payout to consumers by an internet service provider in U.S. history.

$62.5 million will be directly refunded to over 700,000 active subscribers, who will each receive between $75 and $150. It also includes streaming services and premium channels, with a retail value of over $100 million, at no charge for approximately 2.2 million active subscribers.

“This settlement should serve as a wakeup call to any company serving New York consumers: fulfill your promises, or pay the price,” said Attorney General Barbara Underwood. “Not only is this the largest-ever consumer payout by an internet service provider, returning tens of millions of dollars to New Yorkers who were ripped off and providing additional streaming and premium channels as restitution – but it also sets a new standard for how internet providers should fairly market their services.”

Additionally, under the settlement, Charter is required to implement a series of precedent-setting marketing and business reforms, including the requirement to describe internet speeds as “wired” and to substantiate them through regular speed testing.

The state claimed Charter-Spectrum denied customers the reliable and fast internet service it had promised.

This is the first settlement to result from the Attorney General’s major investigation of broadband internet service in New York. The Attorney General said the investigation has also prompted the company to substantial network enhancements to improve its internet service.

In a statement, Charter-Spectrum said it is pleased to have reached a settlement and put the litigation in the past.

"Charter has made, and continues to make, substantial investments enhancing internet service across the state of New York since our 2016 merger, as acknowledged by the Attorney General in this settlement. We look forward to continue providing the best TV, Internet, Voice and Mobile products to our customers, and to bringing broadband to more homes and businesses across the state,” the statement read.

Charter-Spectrum also said any customers eligible for compensation will be contacted directly by the company. They do not need to take any action right now.