Three of the biggest names in telecommunications—Verizon, AT&T, and T-Mobile—have been hit with a hefty combined fine of $10.22 million. This financial reprimand stems from accusations that the carriers misled customers with their “unlimited” plans and enticing “free” phone offers. The settlement, a result of a thorough investigation by a coalition of 50 attorneys general, aims to ensure greater transparency in their advertising practices.

Under the terms of the agreement (PDF), these telecom giants can only tout their plans as “unlimited” if there are genuinely no restrictions on data usage during a billing cycle. Any ads promoting such plans must prominently disclose any potential speed limitations and specify the data threshold before speed reductions kick in.

Moreover, the attorneys general took aim at the allegedly deceptive promises made by Verizon, T-Mobile, and AT&T regarding incentives for customers to switch carriers. Now, these companies must be crystal clear about the terms and conditions of such offers, including the amount customers will receive and when they can expect payment. Additionally, any requirements and hidden fees associated with “free” phone offers must be fully disclosed.

New York Attorney General Letitia James minced no words, stating, “AT&T, Verizon, and T-Mobile lied to millions of consumers, making false promises of free phones and ‘unlimited’ data plans that were simply untrue.” She emphasized that adherence to the law is non-negotiable, regardless of a company’s size, and consumers deserve honesty in their dealings.

As part of the settlement, Verizon, T-Mobile, and AT&T must each appoint a dedicated representative to handle customer complaints. Despite the hefty fine and allegations, the companies deny any wrongdoing. Nick Ludlum, senior vice president of the CTIA, the trade group representing the carriers, stated, “These voluntary agreements reflect no finding of improper conduct and reaffirm the wireless industry’s longstanding commitment to clarity and integrity in advertising so that consumers can make informed decisions about the products and services that best suit them.”

This article was originally published on May 10, 2024, at 5:30 pm ET.