Published on December 5th, 20140
A Sirius Matter
The agreement follows an investigation into Sirius’ billing and marketing practices that was prompted by consumer complaints that the Internet radio giant was charging customers’ credit and debit cards to renew subscriptions without their notice or consent; making it difficult for customers to cancel contracts or obtain refunds; and was jacking up the rates after an initial low introductory price
“Consumers should be able to understand what they are purchasing and exercise their cancellation rights without hassle,” said Ohio Attorney General Mike DeWine, whose office took the lead in the investigation.
As part of the settlement, Sirius will pay the $3.8 million to the states and restitution to consumers who were customers between July 28, 2008 and December 4, 2014.
While Sirius, which has more than 50 million listeners, maintains it disclosed all relevant information about its automatic renewal policies, it agreed to make several changes to its marketing and billing practices. Specifically, the company agreed to:
- More clearly disclose all terms including billing frequency, cancellation policy and automatic renewal procedures.
- Provide advanced notice of upcoming automatic renewals.
- Make it easier for customers to cancel subscriptions.
- Prohibit incentive compensation for customer service representatives that was based on retaining current customers who wanted to cancel subscriptions.