State charges rebate offers were "onerous and condition-laden"
March 4, 2009New York Attorney General Andrew M. Cuomo has reached a $2.63 million agreement with AT&T Mobility over a misleading and deceptive sales promotion involving rebate offers that were fulfilled with onerous and condition-laden rebate cards.
The Attorney Generals agreement requires AT&T to provide more than $2.63 million to consumers who received rebate cards from AT&T in fulfillment of its rebate offers on cellular phones and other wireless equipment and services.
AT&T, as one of this countrys leading companies, has a responsibility to be forthright with its clients and not rely on deceptive practices to increase profits, said Cuomo.
Since 2005, AT&T Mobility, LLC, headquartered in Atlanta, Georgia, has been fulfilling its rebate offers with rebate cards instead of checks. These cards were portrayed as debit cards in the amount of the rebate offer. However, the cards were not redeemable for cash, could not be used for cash withdrawals and expired 120 days from issuance.
The Attorney Generals Office found that AT&T failed to adequately disclose the cards conditions and limitations in its marketing materials for the promotion. AT&T also deceived consumers with offers for free products when, in fact, consumers had to pay the full price up-front and then submit a mail-in rebate form from which they were sent the aforementioned rebate card with its accompanying limitations.
In addition to the $2.63 million to consumers, the settlement requires AT&T to clearly disclose all the terms, conditions and limitations of any rebate offers and cease referring to the cards used to fulfill the rebate offers as debit cards in its advertising unless the cards are redeemable for cash.
The agreement also requires AT&T to clearly disclose any conditions in marketing and advertising materials.
Consumers potentially eligible to receive funds will be notified by AT&T. Qualifying consumers will receive new rebate cards that are fully protected under the terms of the New York State Gift Card Law and which may be used both to purchase products and services anywhere that VISA cards are accepted, and to pay consumers AT&T wireless bills.