Verizon is admitting no wrongdoing in the way it collects administrative fees on customers’ bills, but has agreed to pay $100 million to settle a class-action suit. The settlement was reached in November 2023, and affected customers are now being notified by email and letters.
According to the settlement website, Verizon customers claimed in a class action lawsuit that Verizon routinely charged its individual postpaid wireless account holders a monthly Administrative Charge and/or Administration and Telco Recovery Charge that was unfair and not adequately disclosed.
The complaint alleged that contrary to Verizon’s claims, it’s using the administration charge as a lever to increase its revenues and profits, something other carriers have been accused of doing to avoid calling them out as straight-up price hikes.
The suit states that Verizon first began adding the Administrative Charge to its postpaid wireless customers’ bills in 2005, initially at a rate of 40 cents/month for each phone line on its customers’ service plans. The rate increased on a regular basis, with the most recent increase occurring in June 2022, when it increased from $1.95 to $3.30 per line – a 70% jump.