For years we've been tracking how Verizon socks wireless customers with a bogus $1.99 per MB data access fee -- incurred even if the user's phone is off or the battery was dead. Even users who had data access on their phones blocked were socked by the fee -- given that the message sent to users to tell them they couldn't get data consumed 0.06 kilobytes of data -- resulting in a $1.99 data fee.

The fee was first exposed by the Cleveland Plain Dealer last year, though the story went mainstream after a whistle blower told the New York Times that Verizon was aware of the glitch -- but was too in love with the millions in additional revenue it generated to do anything about it.

After years of pretending the problem didn't exist, Verizon admitted early this month they'd been charging millions of customers this fee for up to three years, and would be refunding consumers to the tune of $50 million. As we guessed then, the announcement wasn't about being nice -- it was made to pre-empt the findings of an FCC investigation and give the illusion they were coming clean of their own volition.

In fact, the FCC began investigating Verizon in January after news reports on the fees (including reports here) began to catch the eye of FCC officials. Today the FCC announced (pdf) that they have ended their investigation into Verizon with a $25 million settlement. As part of the settlement, Verizon must issue immediate refunds to 15 million consumers, cease all future fees of this type, and offer data blocks to any customer who seeks to avoid data charges on his or her bill. Said FCC boss Julius Genachowksi (pdf):Well, maybe. The risk of public flogging wasn't a deterrent, because Verizon just ignored news reports, lied to the FCC, and kept doing it. The financial punishment similarly isn't much of a deterrent because if you do the math -- Verizon potentially billed (at least) fifteen million consumers (at least) $2 a month for two to three years. I've talked to users who've fought Verizon billing about this fee every month -- for years. Other users only saw the fee once. Some users saw the $1.99 fee several times each month.

On the high end of the estimate scale, that means Verizon could have potentially earned more than a billion dollars off of the fees -- far exceeding the $25 million in settlements and $50 million in consumer refunds. Broadband Reports has confirmed that the FCC didn't do an audit on Verizon's estimates or check Verizon's math -- something that's historically not a good idea. You can probably bet that if Verizon was willing to settle this for $75 million, the money earned from the fee was substantially higher.

So while it was good that the FCC acted, given the FCC's efforts did ultimately put this fee to bed years later -- Verizon still very likely made out like a bandit, and didn't have to technically admit any wrong doing. The good news? Consumers are getting refunds now -- and that $50 million total is not capped under the terms of the settlement. In other words, if you disagree with the amount of money Verizon sends your way, the settlement involves giving consumers the right to appeal their refund total with the FCC.