Verizon To Pay $7.4M To Settle Privacy Investigation
Federal Communications Commission
News Media Information 202 / 418-0500
445 12th Street, S.W.
Washington, D.C. 20554
This is an unofficial announcement of Commission action. Release of the full text of a Commission order constitutes official action.
See MCI v. FCC. 515 F 2d 385 (D.C. Cir. 1974).
FOR IMMEDIATE RELEASE:
NEWS MEDIA CONTACT:
September 3, 2014
Neil Grace, 202-418-0506
VERIZON TO PAY $7.4 MILLION TO SETTLE CONSUMER PRIVACY INVESTIGATION
Company Failed to Notify Approximately Two Million Customers of their Privacy Rights Prior to Conducting
Thousands of Marketing Campaigns; Agrees to Three-Year Compliance Plan
Washington, DC – The Federal Communications Commission’s Enforcement Bureau has reached a $7.4
million settlement with Verizon to resolve an investigation into the company’s use of personal consumer
information for marketing purposes. The Enforcement Bureau’s investigation uncovered that Verizon failed to
notify approximately two million new customers, on their first invoices or in welcome letters, of their privacy
rights, including how to opt out from having their personal information used in marketing campaigns, before
the company accessed their personal information to market services to them.
In addition to the $7.4 million
payment, Verizon has agreed to notify customers of their opt-out rights on every bill for the next three years.
“In today’s increasingly connected world, it is critical that every phone company honor its duty to inform
customers of their privacy choices and then to respect those choices,” said Travis LeBlanc, Acting Chief of
the FCC’s Enforcement Bureau. “It is plainly unacceptable for any phone company to use its customers’
personal information for thousands of marketing campaigns without even giving them the choice to opt out.”
Phone companies collect an array of sensitive personal information about their customers, like billing and
location data, and the Communications Act requires them to protect the privacy of that information. A phone
company is generally prohibited from accessing or using certain personal information except in limited
circumstances like marketing, but only after getting the customer’s approval. It can obtain approval through
either an “opt-in” or “opt-out” process. When that process is not working properly, the company must report
the problem to the FCC within five business days.
For many of its customers, Verizon has used an opt-out process, sending opt-out notices to customers either
as a message in their first bill or in a welcome letter. During its investigation, the Enforcement Bureau
learned that, beginning in 2006 and continuing for several years thereafter, Verizon failed to generate the
required opt-out notices to approximately two million customers, depriving them of their right to deny
Verizon permission to access or use their personal information for certain marketing purposes. Moreover, the
Enforcement Bureau learned that Verizon personnel failed to discover these problems until September 2012,
and the company failed to notify the FCC of these problems until January 18, 2013, 126 days later.
Under the terms of the Consent Decree the FCC announced today, Verizon must take significant steps to
improve how it protects the privacy rights of its customers. For example, Verizon will now include opt-out
notices on every bill, not just the first bill, and it will put systems in place to monitor and test its billing
systems and opt-out notice process to ensure that customers are receiving proper notices of their privacy
rights. Any problems detected that are more than an anomaly must be reported to the Commission within five
business days, and any noncompliance must be reported as well.
To resolve the matter, Verizon will pay $7.4 million to the U.S. Treasury, which is the largest such payment
in FCC history for settling an investigation related solely to the privacy of telephone customers’ personal
For more information about the FCC’s rules for ensuring the privacy of consumers’ CPNI, see the FCC
consumer guide, “Protecting Your Telephone Calling Records” available here:
http://www.fcc.gov/guides/protecting-your-telephone-calling-records. For information about other
communications issues, visit the FCC’s Consumer website, or contact the FCC’s Consumer Center by calling
1-888-CALL-FCC (1-888-225-5322) voice or 1-888-TELL-FCC (1-888-835-5322) TTY; faxing 1-866-418-
0232; or by writing to:
Federal Communications Commission
Consumer and Governmental Affairs Bureau
Consumer Inquiries and Complaints Division
445 12th Street, SW
Washington, DC 20554
The Order and Consent Decree are available at:
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