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Charter settlement means up to $150 in refunds for some customers

Customers will receive refunds and free streaming service.

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New York's attorney general settled with Charter Communications over internet speeds.

Al Seib/Getty Images

If you use internet service from Charter's Spectrum, a refund may be headed your way.

New York Attorney General Barbara Underwood announced on Tuesday a $174.2 million consumer fraud settlement with Charter, the state's largest internet service provider, for allegedly failing to deliver the internet speed it promised customers.

"This settlement should serve as a wake-up call to any company serving New York consumers: Fulfill your promises, or pay the price," Underwood said in a release

The settlement requires Charter, operated initially as Time Warner Cable, to pay $62.5 million to over 700,000 active subscribers in New York, with each receiving $75 as direct refunds, according to the AG's release.  An additional $75 will be given to approximately 150,000 of those subscribers who had an inadequate modem for 24 months or more.

Charter must also offer free streaming services, with a retail value of over $100 million, to approximately 2.2 million active internet subscribers, according to the release. People who currently subscribe to internet and cable television can choose between three free months of HBO or six free months of Showtime. All other internet subscribers will get a free month of Charter's Spectrum TV Choice streaming service and a free month of Showtime. (Editors' note: Showtime is a part of CBS, which also owns CNET.)

The lawsuit against Charter started in 2017 following a 16-month investigation. Former New York Attorney General Eric Schneiderman filed the suit against Charter's Spectrum, saying it provided subpar services with internet speeds slower than advertised

Under the settlement, Charter is also required to implement business and marketing reforms, including regular internet speed checks and describing internet speeds as "wired."

"We are pleased to have reached a settlement with the attorney general on the issue of certain Time Warner Cable advertising practices in New York prior to our merger, and to have put this litigation behind us," a Charter spokesperson said in an emailed statement.

Spectrum had been known as Time Warner Cable before Charter purchased it for about $60 billion, in a deal that was completed in May 2016.

First published Dec. 18, 10:07 a.m. PT.
Update, 12:04 p.m.: Adds more details on the refunds and streaming services Charter must offer as part of the settlement.

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