Under the settlement, the New Jersey-based company will be required to pay $11,000 to 50 Connecticut consumers who were charged about $5 per minute to connect to adult websites.
“This settlement puts online con artists on notice,” Blumenthal said. “Connecticut will not tolerate Internet scams.”
The settlement agreement brings to an end a lawsuit brought by the state against Alyon in May 2003 under the Connecticut Unfair Trade Practices Act. The company was accused of linking Internet users to pop-up images and billing them without their consent.
According to prosecutors, Alyon used a dialer program that disconnected users from their own Internet service providers and then reconnected through a higher-charging gateway. The program also captured the consumers’ phone number, matched it with the line subscriber in a directory, and then charged them $4.99 a minute.
“The technology may have been modern, but the MO was familiar – hoodwink and miss-bill consumers, particularly senior citizens,” Blumenthal said. “Alyon’s actions were appalling. The company deployed deceit and deception to trick consumers – some who owned no computer – into signing up for its services.”
In mid-January, Alyon entered into a consent agreement with almost two dozen states that required the company to refund money paid by consumers who said they were fraudulently billed. Under that agreement, the company also had to cancel debt, halt collection activities and implement verification programs for future Internet transactions.