Verizon Sued for Consumer Fraud

March 30, 2009, 12:00:00PM. By Gordon Gibb

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Newark, NJ: A huge case of alleged consumer fraud against Verizon would leave the typical homeowner wishing to never open their door to a door-to-door canvasser again. In this latest alleged violation of the Consumer Fraud Act, Verizon has been called to the carpet by the office of the New Jersey Attorney General in an act of consumer protection.

It appears as if Verizon will do anything to sign you up. The Division of Consumer Affairs—an offshoot of the Attorney General's office in New Jersey—has in fact launched a lawsuit against Verizon New Jersey Inc. alleging deceptive and misleading practices in its marketing, telephone and Internet services.

The allegations represent quite the shopping list.

The company is alleged to have quoted one price for FiOS Service in door-to-door solicitations, direct mail advertising and otherwise, then billed consumers at a higher rate. Consumers were allegedly charged an activation fee after the salesperson in the door-to-door solicitation waived the fee. What's more, unwitting consumers found themselves charged for services, such as movie packages that were never ordered—together with a similar practice of representing that movie packages were free, then billing consumers for the services.

The advertising of a promotional gift is a time-honored way of getting attention and the proverbial foot in the door. But it is always assumed, in good faith by the consumer, that the free gift will be forthcoming. This appeared not to be the case with Verizon. Promotional gifts were advertised, but in many cases Verizon failed to provide consumers with the opportunity to contract for the types of FiOS service necessary to obtain the promotional gifts. To that end, Verizon stands accused of failing to provide consumers with the rewards letter or other instructions necessary to receive their promotional gifts. In some cases the promised freebies were secured only after significant delay, and only after repeated calls to Verizon.

There's more. Verizon has been cited by the New Jersey Attorney General for not providing customers with a written contract, and then billing customers at a price other that quoted. Some customers found that that billing amounts were different month to month even though the services did not change. Other consumers complain that requests to cancel the service were ignored.

"Verizon conducted a very aggressive marketing campaign to introduce its FiOS service, which included promotional gifts that were never to be provided," said David Szuchman, Consumer Affairs Director. "We will seek to ensure that Verizon complies with all relevant laws when advertising and selling services and products."

One of the promotional gifts allegedly advertised were flat-screen TVs. Many consumers jumped at the chance to acquire a flat screen TV and signed up for the service, only to be disappointed not only in the failure to obtain the promised gift, but also with a litany of other consumer fraud complaints as outlined above.

It has been reported that there have been 266 consumer complaints so far related to the marketing practices of Verizon.

"Deception and misrepresentations have no place in the marketplace," said Attorney General Anne Milgram, "and we will hold businesses accountable when they violate the public's trust." In its four-count complaint filed in State Superior Court in Essex County, the state alleges that Verizon violated the Consumer Fraud Act through unconscionable commercial practices, misrepresentations and knowing omissions of material facts, as well as the advertising regulations.

This alleged case of consumer fraud against Verizon could be costly for the company. In New Jersey each violation of the state's Consumer Fraud Act Carries a penalty of up to $10,000 and up to $20,000 for each subsequent violation.

However, beyond that is the breach of a consumer's trust—a consumer willing to spend hard-earned dollars in a time of economic instability. They say an elephant never forgets: well neither does the consumer who spends in the face of economic uncertainty, only to be burned by a vendor taking full advantage of a consumer's good intentions.

Consumer fraud is bad enough at any time, but worse in times of fiscal crisis. Sadly, tough economic times bring out the worst in people—and it seems, in companies too. Consumer protection is of keen interest for Attorneys General, and the Consumer Protection Act guarantees those rights and protections. However, it is unclear if the action by the New Jersey Office of the Attorney General will result in fines for Verizon, or an attempt to compensate consumers. If the latter doesn't happen, it may be in the consumer's best interest to initiate a consumer fraud case with the help of a qualified attorney. After all, you're willing to spend your money at a time when many refuse to do so. The least a corporation can do after benefitting from your business, is to treat you fairly…

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