Senate Report: Time Warner Cable, Charter overcharged customers, did not provide refunds

FILE - In this Feb. 2, 2009, file photo, a Time Warner Cable truck is parked in New York. Time Warner Cable says a problem that occurred during routine maintenance caused a nationwide outage of its Internet service for hours, early Wednesday, Aug. 27, 2014. (AP Photo/Mark Lennihan, File)
(AP Photo/Mark Lennihan, File)

WASHINGTON, D.C. (WKBN/KHON2) — Time Warner Cable and Charter Communications have consistently failed to provide refunds to customers whom they knew they overcharged, according to an investigative report released Thursday by U.S. Senator Rob Portman.

The investigation was led through the Permanent Subcommittee on Investigations, according to a news release from Portman’s office. The investigation included a review of thousands of documents and interviews from witnesses to learn more about the consumer practices of five of the largest pay-TV providers: Comcast, Charter, Time Warner Cable, Dish Network and DirecTV.

Portman said the Subcommittee found the following:

  • During the time period examined by the Subcommittee, Time Warner Cable and Charter Communications — who have recently merged — made no effort to trace equipment overcharges they identified and provide refunds to customers, instead pocketing the overcharges.
  • Time Warner Cable estimates that it overbilled customers $640,000 in just the first four months of this year nationwide. It overbilled consumers nationwide by about $2 million a year for the past six years.
  • When Time Warner Cable discovered the overcharges, it took erroneous charges off customers’ bills going forward but did not provide any backward-looking refunds and did not provide notice to customers so they could investigate the problem themselves.
  • As a result of this investigation, Charter and Time Warner Cable have taken some initial steps to improve their practices. Time Warner performs a monthly audit to find overcharges. The company will provide an automatic one-month credit to all customers for each piece of overbilled equipment or service, and it will provide notice to overbilled customers so they can determine whether to request a credit or refund.

The report found that Time Warner Cable and Charter generally granted refunds or credits only upon customer request. This practice is in contrast to Comcast and DirecTV that provided full refunds to overcharged customers, and Dish’s billing system which is designed to prevent these types of issues from occurring.

While Time Warner overcharged customers $640 in the first four months on 2016, the report also found that the company undercharged customers about $3.5 million over the same period.

Time Warner defended the process by saying it was more efficient as the cost to find overcharges would be time consuming and costly. The company also said that customers were better positioned to notice billing errors and bring it to their attention.

Comcast’s method of identifying overcharges is similar to Time Warner Cable’s, however, Comcast takes an additional step to determining how long a customer has been overcharged and uses that information to grant automatic refunds or credits to customers.

As a result of the inquiry, both Time Warner Cable and Charter have changed some of their policies. Time Warner Cable will start providing an automatic one-month credit to customers that found to have been overbilled by their monthly audit. However, Time Warner will not investigate when it began overcharging those customers unless customers bring specific concerns to the company’s attention. The company will also not automatically provide a full refund dating to when the overcharges began.

Charter will give customers a one-year credit for any equipment overcharges. In addition, Charter has implemented systemic controls that it claims will prevent equipment overcharges in the future.

Mike Pedelty, a Charter Communications spokesperson, released a statement following the investigation:

In May of 2016, Charter completed its acquisition of Time Warner Cable. At just a little more than 30 days post-closing, Charter has been advised that TWC currently catches and corrects any overcharges on a monthly basis. We will put controls into place to catch such instances daily, as we now have installed at Charter, but that will take approximately 60‐90 days. Until then, we will proactively issue a one month credit to any customer that the current monthly process reveals was overcharged,” Pedelty said.

Portman said he is pleased that corrective action has begin, but he will be asking for more refunds for customers who were overbilled previously.

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