Charter has agreed to pay a record $174.2 million to settle fraud charges brought by the New York Attorney General’s Office.
As a part of the settlement, the telecommunications company will have to refund $62.5 million to more than 700,000 customers because it allegedly promised speedier and more reliable internet service than it actually provided to those customers. This will be the largest payout an internet service provider has made to customers, according to an announcement NY Attorney General Barbara D. Underwood made on Tuesday.
Affected customers should receive between $75 and $150 each. Also, about 2.2 million internet subscribers will be provided free premium channels and streaming services.
“This settlement should serve as a wakeup call to any company serving New York consumers: fulfill your promises, or pay the price,” said Underwood in a statement, adding that the case “sets a new standard for how internet providers should fairly market their services.”
At the time of the allegedly fraudulent activity, the company was operating under the brand name Time Warner Cable, but it was renamed Spectrum after Charter purchased the company in May 2016.
“We are pleased to have reached a settlement with the Attorney General on the issue of certain Time Warner Cable advertising practices in New York prior to our merger, and to have put this litigation behind us,” Charter spokesperson John Bonomo told Gizmodo. “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.”
According to the attorney general, Charter will now be required to market the internet speed as “wired” and perform routine speed tests. Customers who are supposed to receive refunds should find out within the next four months.