Sprint Corp. will pay more than $1.1 million to settle charges that it violated consumer credit protection laws, the Federal Trade Commission said Friday.
A federal investigation found that during 2001 and 2002, Sprint failed to live up to requirements of the Fair Credit Reporting Act.
The law requires companies that either deny service or offer modified service based on an unfavorable credit report to notify the customer and provide the name and address of the credit reporting agency.
The trade commission also alleges that Sprint violated the Equal Credit Opportunity Act by failing to provide notices or omitting certain information from the notices it did provide. The laws are designed to give consumers recourse to dispute inaccurate information in their credit reports. Ron Isaac, the trade commission’s lead attorney on the investigation, said the charges involved Sprint’s local and long distance services but were not connected to the company’s wireless business. In a statement, Sprint denied any wrongdoing. „The FTC’s allegations raise a number of technical legal issues,“ spokesman Scott Stoffel said. „But rather than engage in a lengthy, expensive court battle over those issues, Sprint has chosen to put this dispute to rest so that we can instead continue to focus on providing outstanding products and services to our customers in full compliance with applicable legal requirements.“ Sprint agreed to pay $1.125 million under the agreement announced Friday. AT&T, Sprint’s long distance rival, was fined for similar violations uncovered during the same investigation. AT&T will pay $365,000 for violations based on its long distance business, Isaac said. Mark Cooper, director of research with the Consumer Federation of America, said companies should be accountable for constructing barriers to electricity and basic telephone service. „These are necessities,“ he said. „As a matter of public policy, we want citizens to have fair access to the necessities of daily life.“ Shares in Sprint closed Friday at $19.65, down 11 cents. AT&T stock closed at $15.13, up 9 cents.