The company will also cancel debts for more than 20,000 customers as part of a settlement.
Comcast will pay $700,000 in refunds and cancel debts for more than 20,000 customers in Massachusetts as part of a settlement, following allegations that the company used misleading ads about long-term cable contracts, the state attorney general said Tuesday.
The settlement revolves around allegations that Comcast didn't disclose the monthly cost and terms of its long-term cable contracts. This includes not telling customers that the company could raise the cost of some monthly fees any time during the contracts, the Massachusetts attorney general's office said.
"Comcast stuck too many Massachusetts customers with lengthy, expensive contracts that left many in debt and others with damaged credit," Attorney General Maura Healey said. "Customers have a right to clear information about the products and services they buy. This settlement should encourage the entire cable and telecommunications industry to take a close look at their advertisements and make sure customers are getting a fair offer."
The attorney general's office said Comcast provided "inaccurate and misleading" information on pricing to customers who were going into long-term contracts, and failed to disclose fees that could bump up monthly bills by 40 percent above the price that'd been advertised. To cancel long-term contracts, customers had to pay early termination fees of up to $240, the attorney general's office said.
In one series of ads, Comcast said it had a $99 lock-in rate but didn't share that equipment costs and monthly fees would increase a customer's bill. The ads also didn't adequately convey that fees could go up while a customer was in a long-term contract, the attorney general's office said.
Comcast will refund all customers in Massachusetts who paid early termination fees when they downgraded their service or were disconnected by Comcast from January 2015 to March 2016. All remaining unpaid early termination fees incurred from January 2015 to March 2016 for Massachusetts customers will also be forgiven.
The Massachusetts attorney general's office said Comcast "fully cooperated" with the investigation.
"The settlement with the Massachusetts Attorney General's Office reflects our ongoing effort to improve the customer experience," said Comcast spokeswoman Jenni Moyer. "While we disagree with the allegations in the Assurance -- which relate to years-old advertisements and do not reflect Comcast's current policies and practices -- we are committed to partnering with Attorney General Healey and others who share our commitment to improving the experience of our customers in all respects."
As part of the settlement, Comcast will also have to disclose in its ads any additional fees, and train representatives to share the actual prices for monthly services to customers before they sign on to long-term contracts.
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