Released: October 18, 2007

Senator goes after cell phone fees, contracts

Source: Reuters [Washington Post] (Free Registration)

Some cell phone companies charge their users $100 to $200 to end a contract no matter what the reason and disguise their own charges as taxes on bills, witnesses told a congressional panel on Wednesday.

In a hearing to discuss a bill to end these practices, Verizon Wireless CEO Lowell McAdam stonily pleaded for a “light touch” in regulating the cellular telephone industry.

“We talk to customers every day. We don’t need interference,” he told the Senate’s Commerce, Science and Transportation Committee. “I don’t believe that this is necessary regulation.”

The bill requires that early termination fees be pro-rated. Companies now sometimes charge $100 to $200 to users who decide to switch to another service, even soldiers who wanted to drop their service because they were being deployed to Iraq.

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