Sprint, AT&T to pay about $1.5 million to settle claims of credit law violations

Friday, September 10th 2004, 11:36 am

By: News On 6

WASHINGTON (AP) _ Sprint and AT&T will pay nearly $1.5 million in civil penalties to settle government claims that the companies violated federal credit laws for customers seeking telephone service.

The settlement was announced Friday by the Federal Trade Commission.

Under the agreement, Sprint will pay $1.1 million and AT&T will pay $365,000.

The commission said the two companies either denied service to prospective customers or placed conditions on their service because of their credit reports.

In many cases, the companies were then required to notify the consumers of their rights under the Fair Credit Reporting Act to obtain a free copy of their credit report or of their right to dispute with the credit bureau information in their reports. The FTC says those notifications were not sent to consumers, or were sent but were incomplete.

In the case of Sprint, about 550,000 consumers were affected.

The AT&T case involved roughly 175,000 consumers.