AT&T settles FTC lawsuit, will pay $60 million to customers

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FILE – In this Tuesday, Oct. 21, 2014, file photo, people pass an AT&T store on New York’s Madison Avenue. AT&T reports financial results on Tuesday, April 26, 2016. (AP Photo/Richard Drew, File)

(KXAN) — AT&T has settled a lawsuit filed by the Federal Trade Commissions by agreeing to pay $60 million to its customers.

This comes after the FTC filed a complaint against AT&T back in 2014 accusing the company of misleading millions of its customers by charging them for “unlimited” data on their smartphone plans while reducing their speeds at the same time.

” AT&T promised unlimited data — without qualification — and failed to deliver on that promise,” Andrew Smith, Director of the FTC’s Bureau of Consumer Protection said in a press release. “While it seems obvious, it bears repeating that Internet providers must tell people about any restrictions on the speed or amount of data promised.”

According to the FTC complaint, while AT&T was promising their smartphone customers with unlimited data, the wireless provider began throttling customers’ data in 2011 after they used a much as of two gigabytes of data in a billing period.

The FTC also says that AT&T’s alleged operation affected more than 3.5 million customers since October 2014.

As part of AT&T’s settlement, the company is barred from making promises on the speed or amount of mobile data to customers without disclosing any restrictions. This includes reducing the speed of customers’ data after reaching a certain cap.

The $60 million from AT&T will be deposited into a fund where the wireless provider will offer partial refunds to both current and former customers who signed up for the unlimited data plans before 2011.

Current AT&T customers will receive credit to their bills automatically. Former customers will receive refund checks with the amount they are owed.

Customers who were effected will not have to submit claims for their refunds.

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