Does FreedomPop Illegally Nickel And Dime Its Customers?


In October, 2012, FreedomPop made available its Photon mobile hotspot. For a refundable deposit of $89.00, a customer would receive a mobile hotspot through which a customer would receive up to 500 megabytes of internet data usage per month at no charge.

FreedomPop charges a small fee if at least 5 megabytes of internet data usage is not used each month. They also charge a reasonably small amount for additional data that is used after the free 500 megabytes of internet data usage.

I have seen periodic online complaints of FreedomPop charging their customers for no usage or for more usage than what has been given away for free. But, in my opinion, these complaints are without merit because it seems that these FreedomPop customers either have not taken the time to become familiar with FreedomPop’s terms and conditions or, if they were aware of FreedomPop’s guidelines, they were negligent with regard to their data management responsibilities.

I used my FreedomPop Photon mobile hotpot at least once per month, for about six month, without exceeding the amount of data that was provided for free. I was never charged any additional charges. But the coverage in the area around my home is limited. So I decided to return the device.

FreedomPop’s terms and conditions have also stated that, if the Photon mobile hotpot is returned with one year, the $89.00 deposit would be refunded. I repacked the Photon mobile hotspot along with its original accessories, exactly as they were packed in the original box. I shipped everything to the address that FreedomPop provided for returns. And I waited for confirmation that the device had been received.

Several days later, I received an email that said:

This message is to inform you that FreedomPop has received your device and we have issued you a refund for your security deposit or device purchase. This refund may take up to 5-7 days to be posted to your credit card statement. 

Several days later, I saw a credit from FreedomPop on my credit card account. But the amount was for $80.75, instead of the $89.00 that I had expected. Disappointed, I submitted a request through FreedomPop’s online support website that said:

I returned the Photon hotspot for which I paid an $89.00 refundable deposit in October, 2012. The Photon had been used less than ten times, and it was packed in the original box with all of the original packaging, instructions, and stickers intact. I expected to receive a refund of the $89.00 deposit that I paid. I received a refund of $80.75. It is important that I receive an additional refund of $8.25 so that the $89.00 deposit is refunded as has been expected.

 I would like for a manager to call me today so that we can discuss this issue and so that this refund can be completed.

 Thank you.

 Three days later, I received an email response that said:

Your device was received in good condition and the majority of your deposit was refunded. We were charged a small fee by our logistics partner to test the device and ensure it is in working order. This fee was deducted at cost per our T&Cs and should be nominal. We are absolutely committed to making internet as free as possible, for all of our customers. We hope to become more flexible with this fee as our company grows but we cannot cover it at this time.

I instantly replied to the support email response as follows:

1. The Ts & Cs do not mention a fee for testing.

2. I asked you to have a manager call me.

3. Why has a manager not yet called me?

4. Please have a manager call me tomorrow.

The next day, I received a telephone call from Ryan at FreedomPop. He said that he is FreedomPop’s director of customer support. In Ryan’s response over the telephone, he said:

FreedomPop gives away millions of megabytes of data every day.

I interrupted him, and I said:

Excuse me, Ryan. That has nothing to do with my concerns. Please address the reason for my request for support.

Ryan paused, and then said:

It costs money to ship Freedompop’s devices to and from our customers.

I interrupted him again, and I said:

But, Ryan, I paid for shipping the device both to me and for the return to FreedomPop. You are nickel and diming me for no reason. Why was the refund of my $89.00 deposit $8.25 short?

Ryan paused for about three seconds. He then said:

A third party company tests devices that have been returned to us. The $8.25 is a testing fee, which is included in the terms and conditions.

I said:

No, it’s not. Please tell me where you think that it’s included in the terms and conditions. 

Ryan then said:

All shipping and handling fees are non-refundable.

I immediately responded:

That’s fine. But, in order for a fee to be non-refundable, the fee must be included in the original terms and conditions, and it must be billed. This $8.25 testing fee has never been included in the terms and conditions, and you’re trying to illegally deduct it from the $89.00 deposit which is outlined in the terms and conditions. There is a problem here. Please refund the additional $8.25 that FreedomPop owes me.

There was another pause. I could tell that Ryan was trying to think of a valid reason to counter my argument. He then said that he would refund the $8.25 that was being debated. He also said that he could not issue a credit to my credit card, but that he would need to have a check mailed to me. I said that that would be fine. Ironically, I received a follow up email from Ryan in which he said:

I have refunded the handling fee of $8.25 to your card. You will receive this in 3-5 business days.

I also told Ryan that FreedomPop must stop nickel and diming its customers for this bogus testing fee. I also said that I was sure that he knew that it was not the right thing to do.

FreedomPop must stop cheating its customers. They should also refund the $8.25 testing fees that have already been subtracted from other FreedomPop customers’ deposit refunds.

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