Settlement Includes Restitution for Consumers
Attorney General Peter F. Kilmartin along with the attorneys general of 44 states and the District of Columbia, announced today that Sirius XM Radio Inc. of New York has agreed to pay $3.8 million to the states and to provide restitution to eligible consumers to resolve claims that the satellite radio company engaged in misleading advertising and billing practices. The State of Rhode Island will receive approximately $48,000 through this settlement.
Consumers who have not previously filed a complaint with their attorney general for the practices covered by this settlement have 150 days from today to file a complaint to be considered for restitution.
"Sirius made it nearly impossible for consumers to cancel contracts and tacked on unauthorized fees to accounts. This settlement provides those consumers with restitution for their claims and requires that the company implement a consumer-centric approach to its billing and marketing practices. If Sirius put the consumer before profits from the outset, the company could have avoided this lengthy and costly investigation and maintained satisfied customers. I hope this settlement serves as a valuable a lesson to other companies that it is always better to put the customer first," said Attorney General Peter Kilmartin.
Kilmartin alleges that Sirius XM engaged in misleading, unfair, and deceptive acts or practices in violation of state consumer protection laws.
The investigation focused on consumer complaints involving: difficulty canceling contracts; cancellation requests that were not honored; misrepresentations that the consumer's Sirius XM service would be canceled and not renewed; contracts that were automatically renewed without consumers' notice or consent; unauthorized fees; higher, unanticipated rates after a low introductory rate; and Sirius XM failing to provide timely refunds.
Under the terms of the settlement through an Assurance of Voluntary Compliance, Sirius XM will make significant changes to its business practices. Specifically, Sirius XM agrees to:
o Clearly and conspicuously disclose all terms and conditions at the point of sale, such as billing frequency, term length, automatic renewal date, and cancellation policy.
o Make no misrepresentations about the available plans in advertisements.
o Provide advance notice via mail or email about upcoming automatic renewals for plans lasting longer than six months.
o Revise the cancellation procedures to make it easier for consumers to cancel.
o Prohibit incentive compensation for customer service representatives based solely on "saves," or retaining current customers who attempt to cancel.
In addition to the $3.8 million that Sirius XM will pay the states, the company also will provide restitution to eligible consumers who have complaints about the problems addressed by the Assurance.
To be considered for restitution under this settlement, consumers must file a complaint concerning conduct from July 28, 2008 to Dec. 4, 2014 that involves an identifiable loss that has not been previously resolved with their state attorney general.
To file a complaint, Rhode Island consumers should contact the Consumer Protection Unit at the Office of Attorney General by calling 401-274-4400 or emailing contactus@riag.ri.gov. Consumers can also contact Sirius XM directly with their complaints. Complaints can be sent by mail to PO Box 33059, Detroit MI 48232-5059 or by going to the following web address: www.siriusxm.com/settlementprogram.