T-Mobile is in for quite a predicament because of an alleged false advertisement that promises to get rid of service contracts and hidden fees, which New York Attorney General Eric Schneiderman is investigating.
With CEO John Legere at the helm, T-Mobile was able to rank as the third largest carrier in the United States this year with the company's Uncarrier campaign, going past Sprint. On Monday, the carrier also came out on top when Consumer Reports readers chose T-Mobile as the nation's best wireless carrier, gaining the upper hand against AT&T, Sprint and Verizon.
However, critics have filed complaints against T-Mobile, wherein a letter that describes "deceptive marketing and abusive debt collection practices" is reportedly on the way to the Consumer Financial Protection Bureau.
According to the labor and consumer association Change to Win (CtW), approximately 91 percent of T-Mobile's customers are locked into two-year equipment installment plans, which require a hefty sum to exit. The letter to the consumer bureau indicates that the conditions of the phone loans go against the carrier's advertisement. The Consumer Federation of California and other civil rights and consumer advocacy groups signed the letter as well.
Also, subscribers who break off from their contracts before 24 months might be placed in debt collection "with little or no notice" or be penalized with a bigger debt compared with the usual amount in breaking traditional service agreements.
"We ask T-Mobile to reform its own practices by no longer using the misleading language around no contracts. We ask that it stop claiming that it pays customers' early termination fees," Nell Geiser, a research director of CtW, says.
Annie Garrigan, a T-Mobile spokesperson, declined to comment. Eric Soufer, a spokesperson for the New York Attorney General, only says that the investigation is ongoing.
The online advocacy group Color of Change also complains that T-Mobile gives customers something different from what it promises, saying that the carrier unfairly targets people of color.
To get T-Mobile under scrutiny, CtW intends to send a complaint to the Federal Communications Commission, and Color of Change plans to spread a petition on Tuesday to get the public to demand for an investigation as well.
