Vermont Attorney General Announces Settlement With AOL

July 11, 2007 - Vermont Attorney General William Sorrell announced today announced a settlement with AOL, one of the nation’s largest Internet service providers, requiring the company to change significantly the way it handles account cancellation requests and to make refunds to consumers.

The settlement, in the form of an Assurance of Voluntary Compliance filed by 48 states and the District of Columbia, resolves complaints from consumers about difficulty and confusion in canceling their AOL paid services. AOL formerly limited the methods available for consumers to cancel their accounts, so that most consumers attempted to cancel by calling AOL directly. Customer service representatives received incentives for retaining or “saving” customers in this situation, and consumers complained that as a result, cancellation was extremely difficult. The multistate settlement strictly limits this practice and requires recording and verification of these telephone calls. In addition, the settlement expands consumers’ options by allowing them to cancel through a simple online method via the website http://cancel.aol.com.

Article continues below...

The settlement further requires AOL to make refunds to consumers who have complained of unauthorized charges for AOL service. In addition to resolving any outstanding complaints, the company will adopt a process for refunding consumers for unauthorized charges and will continue to cooperate with the states in these efforts.

The settlement also addresses a number of other billing practices that created consumer confusion. Specifically, AOL will revise its disclosures on reactivation of terminated accounts and accounts billed directly to a consumer’s monthly telephone bill. Finally, AOL will also revise its practice of allowing consumers to create “spin off” accounts—which are additional paid accounts for AOL service stemming from one original membership; these accounts will now only be created over the phone in a recorded conversation with a customer service agent, who will have to make detailed disclosures of the applicable costs.

AOL recently announced that it would begin limiting its role as an Internet access provider and allow its customers to convert to free e-mail accounts. The terms of the multistate settlement should minimize the potential for consumer confusion during this transition.

Source: Vermont Attorney General