A class action lawsuit has been filed against the cellular service provider for allegedly illegally profiting form late fee charges. The lawsuit was filed in Alameda Superior Court and alleges Verizon Wireless' late fees are inflated and operate as a profit center. The suit claims that companies are only allowed to use late payment fees to recoup the actual costs associated with late payments.
Verizon Wireless imposes the late charges under its standard customer contract that allows for a late charge of 18 percent annually, or a flat $5 fee, whichever is greater. Under California state law, consumers must be charged no more than a reasonable sum that approximates the actual costs associated with processing late fees.
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