Device financing terms to be clarified going forward; some customers can leave without penalty
T-Mobile has been making some big steps towards what it calls an "UNcarrier" strategy, which clarifies device pricing, ends phone contracts and gives customers more choice in the wireless industry. In trying to reinvent its strategy, however, T-Mobile has apparently ruffled some feathers at the Washington State Attorney General's office. Attorney General Bob Ferguson claims that T-Mobile's new plan structure is deceptive, leaves unfulfilled promises, and has "duped" consumers.
Ferguson specifically takes issue with the way T-Mobile now finances devices -- with a small down payment and monthly installments -- claiming that although the carrier claims there is no commitment to the service, customers will have to stay for 24 months or "face an unanticipated balloon payment for the phone equipment". Specifically, the AG had this to say:
“My office identified that T-Mobile was failing to disclose a critical component of their new plan to consumers, and we acted quickly to stop this practice and protect consumers across the country from harm.”
Ferguson has filed a court order, which has been signed and agreed upon by T-Mobile, that will force the carrier to clarify its terms of service and stop what Ferguson calls "deceptive advertising". Under the terms of the order, T-Mobile has created a document called the "an Assurance of Discontinuance (AOD)", better laying out the terms of the new Simple Choice plans. Inside, the carrier agrees not to:
- Misrepresent consumers' obligations under its contracts, including those contracts that have not restrictions or limitations; and
- Fail to adequately disclose that customers who terminate their T-Mobile wireless service before their device is paid off will have to pay the balance due on the phone at the time of cancelation.
As part of the settlement, anyone who purchased service from T-mobile from March 26 to April 25 will be given an opportunity to leave the service agreement, with no penalty, and receive a full refund for the device and service provided they cite the terms of the new AOD.