Security software providers Symantec and McAfee have to pay $375,000 each to clear up accusations that they charged fees against customer credit cards without the customers’ knowledge or authorisation as part of a settlement issued by New York’s Attorney General.
In addition, both the companies also agreed to make detailed disclosures of any automatic subscription fees and renewals and ensure a transparent solution for customers to opt out of them.
The agreement comes after an investigation by the New York attorney general’s office where the investigators found that the two companies had “failed to adequately disclose to consumers that they would be automatically charged to renew software subscriptions once they expired.”
New York Attorney General Andrew Cuomo described the practice as hide the ball, and a press release issued by his office said: Customers have a right to know what they are paying, especially when they are unwittingly agreeing to renewal fees that will not appear on their credit card bill for months. It was also mentioned that the fees was hidden at the bottom of long webpages or in the fine print of license agreements.
Consequently, both companies are required to notify customers before and after the renewal deadlines and will provide refunds to those who request them within 60 days of being charged. The settlement also says that the companies will be open about the length of time that they will continue to provide support and updates for their software.
Media reports confirm that it has become a common practice for security companies to offer automatic renewals to their customers and the trend has gained traction in the past few years. Symantec started this practice in the year 2005 and McAfee began in 2001.
