TracFone to pay $40 million for 'deceiving customers'

Posted: Updated:
By Christina O'Haver By Christina O'Haver

PHOENIX -- TracFone Wireless, one of the nation's largest prepaid phone companies, has agreed to pay $40 million to settle claims it deceived customers with its unlimited data plans.

The Federal Trade Commission made the announcement Wednesday.

"This gets into the maybe false advertising or basically misleading advertising, where they say you have unlimited access without explaining, until you hit a certain level," said Ken Colburn of Data Doctors.

According to the lawsuit, TracFone Wireless would do what tech insiders call "throttling," Colburn explained.

"People that are being throttled will notice that their Internet connection has suddenly become noticeably slower," he said.

In some cases, the data may have been stopped or the service terminated altogether.

The FTC said customers who had one of these plans between July 24, 2009 and Dec. 31, 2014 could be entitled to a check.

"Their suggestion is, if you were a customer of this service, just go ahead and file a claim, and they will sort out who is entitled to compensation and who is not based on the technical information they'll be able to look up, based on your phone number," Colburn said.

There are two ways to file a claim, either online here or by mailing in a form, which can be printed from this website.

Colburn said this is a good lesson for everyone to be wary of unlimited plans and always read the fine print.

"Just ask from this point forward, 'Is this a plan that my data will get throttled down when I hit a certain level?' " he said.

If you are concerned about a decrease in data, Colburn recommends downloading an app that would test the upload and download speed on your mobile device.