Verizon to Pay the Largest Fine for Invading Customers' Privacy

                                                     

 

A U.S. investigation has put the telecom company Verizon Communications Inc. in a soup of sorts by levying the largest fine so far. The investigation has found that the telecom giant failed to properly notify some customers of their privacy rights before using their information for marketing. Unfortunately, the company will now have to pay a substantial sum of $7.4 million to settle the reported investigation.

The Federal Communications Commission (FCC) said its investigation figured out that beginning in 2006, around two million fresh customers of Verizon phone did not receive due privacy notices along with their first bill. The notices that should have carried relevant information for its consumers on how not to allow their personal information for tailoring marketing offers by the company were not sent to its customers. Although the company sent it to some of them later, the damage had been done to those who did not get it at all.

Mobile companies are generally prohibited from using personal data of their customers, which they collect initially during the connection giving documentation formalities. Although, such data can be used for marketing after attaining special permission from its owner, its use is restricted.

FCC's Enforcement Bureau has strongly condemned this move by the telecom giant as “unacceptable”. The bureau criticized the incident saying that phone companies cannot use its customers' personal information for marketing campaigns without even giving them the choice to opt out. Verizon has now agreed to send the much required opt-out notices on every bill to its customers and has agreed to pay the largest fine in FCC's history of settlements over investigations into telephone customers' personal data privacy.

Verizon, in its defense, said that only its landline customers were affected by the use of personal information in marketing campaigns. It also said that the discrepancy to the FCC was reported on Jan. 18, 2013, though the FCC said it was aware of the problem in September 2012. The company also explained that the incident did not involve a data breach or an unauthorized disclosure of customer information to third parties. Verizon takes its obligation to comply with all FCC rules seriously, and once it had discovered the issue with the notices it informed the FCC immediately, fixed the problem and implemented a number of measures to make sure it does not happen again.