Verizon Communications Fined For $7.4 Million Due To Customer Privacy Violation

ByInigo Monzon

Sep 04, 2014 03:56 AM EDT

American telecomm operator Verizon Communications has agreed to pay $7.4 million in a settlement deal for violating their customers' privacy, CNN reported.

According to the Federal Communications Commission (FCC), the organization which imposed the fine, the company failed to notify its over 2 million clients that it was using their personal information such as browsing habits, age and location, for marketing purposes.

In addition, the customers were not made aware by Verizon that they have the option to inform the company to not be included in its marketing campaign.

"It is plainly unacceptable for any phone company to use its customers' personal information for thousands of marketing campaigns without even giving them the choice to opt out," FCC's enforcement director Travis LeBlanc said.

FCC regulators noted that since 2006, the company has been using their clients' personal information to advertise new Verizon services through their bills without their consent, according to the Washington Post.

Verizon only noticed the privacy violation in September of 2012. However, the company failed to notify the FCC in time regarding the issue.

Typically, companies are required to report problems about billing within five days after being identified. In this case though, it took four months before Verizon notified the FCC.

According to Verizon spokesperson Ed McFadden, the company has resolved the problem almost immediately after reporting it to the FCC.

McFadden also mentioned that Verizon did not disclose private customer information to any third party organization, Reuters reported.

"The issue here was that a notice required by FCC rules inadvertently was not provided to certain of Verizon's wireline customers before they received marketing materials from Verizon for other Verizon services that might be of interest to them," McFadden said.

"It did not involve a data breach or an unauthorized disclosure of customer information to third parties," he added.

"Verizon takes seriously its obligation to comply with all FCC rules, and once we disclose the issue with the notices, we informed the FCC, fixed the problem and implemented a number of measures to ensure it does not recur," McFadden continued.