Bell to Pay $10 Million for Misleading Advertisements

by Jordan Richardson on June 29, 2011

Bell Canada has agreed to pay a $10 million penalty for misleading advertising claims. The penalty is the maximum amount allowed by law under the Competition Act, says the federal Competition Bureau.

According to the Bureau, Bell had charged more than advertised for many of its services. Bell had been doing this since 2007 and hid extra fees, like some related to TouchTone and modem rentals, in the fine print.

“I am pleased that Bell co-operated with the Bureau’s investigation and is taking steps to correct the misleading advertisements,” Melanie Aitken, Commissioner of Competition, said. “When a price is offered to consumers, it must be accurate. Including a fine-print disclaimer is no licence to advertise prices that are not available.”

Bell says that they “fundamentally disagree” with the findings.

“Bell’s advertising has always complied with all applicable laws and been comparable with common advertising practice past and present in the communications marketplace and other industries in Canada,” it said. “However, Bell has decided to immediately resolve the issue and move forward by paying an administrative amount of $10 million.”

Bell’s semantics aside, the Bureau clearly has the telecommunications carrier caught in the mix. Bell also agreed to fix the advertising that was “not in compliance,” which is an interesting move if they believe the Bureau’s findings to be wrong.

On top of the $10 million penalty and the realignment of advertising, Bell will pony up $100,000 for the cost of the Competition Bureau’s investigation.

Certainly hidden costs in the telecommunications sector are commonplace, as customers rarely pay the advertised price under any provider. The Competition Bureau wouldn’t say if other similar investigations were underway.

One example of Bell’s misleading advertising scheme is the presentation of a bundle for Internet, home phone and television services. The bundle is advertised by Bell at starting at $69.90 per month, but the lowest possible price it is $80.27 per month.

These sorts of traps lie in wait for consumers across the country, of course. They aren’t confined to the telecommunications sector, but Canada’s giants are hiding fees and charges wherever they can. Whether this resounding message from the Competition Bureau will change all that remains to be seen, but I wouldn’t bet on it. Ripping off consumers is, after all, the chosen routine of Canada’s carriers.

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