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Cingular Fined $12 Million by State Regulators

September 10, 2003|From Times Wire Services

SAN FRANCISCO — California regulators Tuesday fined Cingular Wireless $12.14 million for violating state laws by not allowing customers to cancel service during a trial "grace period."

Cingular prohibited customers from canceling cell phone service early unless they agreed to pay a $150 fee, the Public Utilities Commission said.

The regulatory board also said some Cingular agents imposed additional cancellation fees of up to $400 before the company instituted a 15-day refund policy in May 2002.

In addition, Cingular failed to disclose network problems to customers in 2001 when the mobile phone service provider struggled to add coverage and capacity to keep pace with a growing number of customers.

A Cingular spokesman said the company would appeal the decision, which he called "fatally flawed from both a legal and factual perspective regarding Cingular's service levels and performance throughout the state."

"We stand by our commitment to providing our millions of California customers with top-notch, quality service," spokesman Michael Bennett said. "Furthermore, our business practices always have been and continue to be customer-focused, lawful and fair."

In addition to the $12.14 million in fines, the commission also ordered Cingular to reimburse customers who paid part or all of the early termination fee. Cingular Wireless is a joint venture between SBC Communications Inc. and BellSouth Corp.

Separately, Cingular on Tuesday joined with 22 other cell phone companies and adopted voluntary customer-rights standards as they try to derail tougher rules proposed by the same California regulators.

The Cellular Telecommunications & Internet Assn., an industry trade group, unveiled its guidelines in Washington. They include giving customers at least a 14-day trial period for new service and disclosing rates in advertisements.

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