DirecTV charged with false advertising

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NEW YORK (CNNMoney) — The FTC has charged DirecTV with fraud, claiming that it misled customers with its popular 12-month discount package.

The satellite company advertises a 12-month plan for as little as $19.95, but fails to make it clear that a two-year contract

From DirecTV/CNN

From DirecTV/CNN

is required, according to the Federal Trade Commission. That means customers are getting stuck with a longer contract than they wanted. What’s worse: The package’s price jumps in the second year by between $25 and $45 per month. Customers that try to cancel early are hit with a fee of up to $480, according to the complaint.

The company also failed to make clear that customers must proactively cancel the free premium channels like HBO and Showtime that they get during the first three months of the package. If they don’t, they’re charged automatically.

With more than 20 million subscribers, DirecTV is the largest satellite television provider in the country. A “large portion” of those customers could have been affected, said FTC Director Jessica Rich on a call with reporters.

The complaint was filed in federal court. The FTC is asking the judge to stop the company from the allegedly illegal conduct, and is seeking money that would be used to refund customers, which could reach millions of dollars, Rich said.

DirecTV denies the agency’s claims.

“The FTC’s decision is flat-out wrong and we will vigorously defend ourselves, for as long as it takes,” the company said.

While FTC Director Rich said that the company sometimes included a disclaimer in the fine print, but in other cases it was obscured by text and pictures.

She would not comment on whether or not the lawsuit would affect DirecTV’s pending merger with AT&T. The $49 billion deal still needs federal approval.

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7 comments

  • alana k

    2009-2010 i had a very misleading and aggravating experience also. When i called to order they made an appointment. I was offered the promotion for a low price. When they came to install the man brought a contract for me to sign, which was never mentioned prior, when I refused he said i will have to pay over $200 for cancellation fees because he ‘provided service by coming to the appointment’ in which they already had my credit card info so i went on and signed the 12 month promo 18 month contract. When i called to cancel at 17 mths the operator said it was too early to cancel and offered me more promos to continue my service, i explained to her that i would just like my service cancelled asap. So she stated that she would make note on my acct that the next month would be my last. Direct tv continued billing me 19mths + and when i called to complain nobody ever knew what was going on and refused to close my acct until i paid the unpaid balance (which i never used the service and had already called to cancel mths prior). To this day i refuse to pay for the added amount. I have the origional bills saved where it shows my origional balance and the added on amounts.

  • heather perry

    My question is we had direct tv like 3 years ago not recently is this something that has been going on that long?

  • Concerned Consumer

    You think they got false advertising issues now, just wait until after the merger with AT&T. Baby, you ain’t seen nothing yet!!!

  • kat

    the 12mo discount with a 2yr agreement was made very clear to us. we’ve been directv customers since 2007 & even though we’ve not always been happy with our costs, they’ve always made it work for us… unlike our previous cable provider (Comcast)…

  • Fifty Shade Seattle

    About time someone is doing something about this. Direct tv is a client for a company I used to work for, so I collected over due and unpaid bills for them and most of the bills were because of that two year contract and the early termination fees wich are about $450, so the customers didn’t want to pay it because they were pissed that they didn’t know they had signed up for a two year contract and Now they had ETF fees and also equipment fees. If you don’t send your equipment back within like 90 days or something from the date your service has ended then they charge you like $200 for it no matter what, so if you send it back after the 90 days, you still have to pay it. I will never use Direct TV

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