Qwest settles fraud investigation

Qwest Communications settled a long-standing consumer fraud lawsuit with the Arizona Attorney General’s Office Monday by agreeing to pay a $3.75 million fine and to better inform customers about their options.

The suit, filed in 2001 by then-Attorney General Janet Napolitano, accused Qwest of numerous violations of Arizona’s Consumer Fraud Act, including placing unauthorized charges on consumers’ bills; failing to disclose charges associated with repairs and installation; engaging in false and misleading advertising; and setting up customer service departments that frustrate consumers’ attempts to resolve problems.

Qwest didn’t admit any wrongdoing but agreed to pay the fine to defray the cost of the state’s investigation and to help fund future anti-fraud activities.

The settlement gives consumers, who believe they were mistreated by Qwest anytime from May 2001 to the present, a 90-day window to file a complaint with the Attorney General’s Office. The company already has settled 2,140 such claims in amounts ranging from $80 to $7,000. Information on how to file a complaint is available at: http://www.attorneygeneral.state.az.us/ or by calling (800) 352-8431 or (602) 542-5763.

Qwest also has agreed to contact all customers who bought service packages during the period and explain all of the options that may have been available at the time. Customers would then be allowed to switch to lower-cost plans if they weren’t earlier explained to them. The state alleges many people signed up for expensive packages, believing they were the lowest offered.

Qwest will make the solicitations in Spanish as well as English and print all future communications to customers in both languages.

Attorney General Terry Goddard, who took over the case from Napolitano, said Hispanics were particularly hard hit by the deceptive practices. He called the settlement good news for Arizona consumers, a sentiment shared by Phyllis Rowe of the Arizona Consumers Council.

But Jon Poston, whose Arizonans for Competition in Telephone Service represents a number of Qwest competitors, called it a slap on the wrist.

“Qwest makes a million dollars a day in Arizona. This is just a cost of doing business to them.”

Qwest spokes Jeff Mirasola said the company takes the fine very seriously and has already implemented many of the stipulations in the settlement.

“We’re just glad to get this behind up,” he said.