Sept. 3 — Under a consent decree, Verizon Communications Inc. will pay $7.4 million to resolve a customer privacy violation investigation by the Federal Communications Commission—the largest customer privacy settlement the regulator has ever reached—the FCC announced in a Sept. 3 statement.
The company failed to notify approximately 2 million new wireline customers that they could opt out of letting Verizon use their personal information to market them Verizon services, the FCC Enforcement Bureau (EB) said in the statement.
In addition to the payment, Verizon has agreed to notify its customers of their privacy rights on every billing statement for the next three years and “put systems in place to monitor and test its billing systems and opt-out notice process,” the EB said.
“It is plainly unacceptable for any phone company to use its customers' personal information for thousands of marketing campaigns without even giving them the choice to opt out,” EB Acting Chief Travis LeBlanc said in the statement.
“The issue here was that a notice required by FCC rules inadvertently was not provided to certain of Verizon's wireline customers before they received marketing materials from Verizon for other Verizon services that might be of interest to them,” the company said in a Sept. 3 press release.
The Verizon statement said that the company takes compliance with FCC rules seriously, already has fixed the issue and has taken steps to ensure the same notification problems do not occur again.
“It did not involve a data breach or an unauthorized disclosure of customer information to third parties,” the company said in the statement.
Under the Communications Act, companies are required to notify customers that they can choose not to have their personal info used for marketing purposes. Verizon has traditionally fulfilled this requirement through notices as part of their welcome letters or on a first billing statement to new customers, the FCC said.
“When that process is not working properly, the company must report the problem to the FCC within five business days,” the FCC said.
“Beginning in 2006 and continuing for several years thereafter, Verizon failed to generate the required opt-out notices to approximately two million customers, depriving them of their right to deny Verizon permission to access or use their personal information for certain marketing purposes,” the FCC said.
Verizon personnel didn't discover the issue until 2012, however, but the FCC was not notified for 126 days after that discovery, the EB said in the statement.
Full text of the commission's order adopting the consent decree—with an unsigned copy of the consent decree attached—is available at http://op.bna.com/pl.nsf/r?Open=dapn-9nnjld.
All Bloomberg BNA treatises are available on standing order, which ensures you will always receive the most current edition of the book or supplement of the title you have ordered from Bloomberg BNA’s book division. As soon as a new supplement or edition is published (usually annually) for a title you’ve previously purchased and requested to be placed on standing order, we’ll ship it to you to review for 30 days without any obligation. During this period, you can either (a) honor the invoice and receive a 5% discount (in addition to any other discounts you may qualify for) off the then-current price of the update, plus shipping and handling or (b) return the book(s), in which case, your invoice will be cancelled upon receipt of the book(s). Call us for a prepaid UPS label for your return. It’s as simple and easy as that. Most importantly, standing orders mean you will never have to worry about the timeliness of the information you’re relying on. And, you may discontinue standing orders at any time by contacting us at 1.800.960.1220 or by sending an email to firstname.lastname@example.org.
Put me on standing order at a 5% discount off list price of all future updates, in addition to any other discounts I may quality for. (Returnable within 30 days.)
Notify me when updates are available (No standing order will be created).
This Bloomberg BNA report is available on standing order, which ensures you will all receive the latest edition. This report is updated annually and we will send you the latest edition once it has been published. By signing up for standing order you will never have to worry about the timeliness of the information you need. And, you may discontinue standing orders at any time by contacting us at 1.800.372.1033, option 5, or by sending us an email to email@example.com.
Put me on standing order
Notify me when new releases are available (no standing order will be created)