AT&T Is Discriminating Against People With Good Credit

I don’t know if this is against the law, but if it is, I would be happy to join a class action suit against AT&T.

Last night I tried to activate the iPhone that I recieved as a gift with a pre-paid plan. A plan that I am sure tens of thousands of people have on their iPhones. The iTunes system would not allow me to activate. I got a message that said:

Additional information required to activate your iPhone

Please call AT&T at 877-800-3701 to complete your activation.

Refer to your Activation ID when calling

It was late when I got to that point, so I called AT&T this morning. I talked to a very nice customer service rep who told me that I could not get an iPhone without giving them my social security number. I told her that I was a tech blogger and just wanted to test the iPhone, review it, and then give it as a gift and I had no need or desire to sign a 2 year contract. She told me there was nothing she could do. So I asked for a manager.

After about five minutes, the manager got on the line. I repeated my case, asked him to authorize a prepaid plan for my phone. He said he could not do so. That it was AT&T policy to only issue pre-paid plans to people with valid social security numbers who fail a credit check.

So there it is. You cannot get a prepaid plan from AT&T unless you are a deadbeat. That’s discrimination in my book. And I suspect its illegal at some level.

I will never, ever, use an AT&T service again.

#VC & Technology

Comments (Archived):

  1. ppearlman

    give ’em hell fred!

  2. Fake Richard Branson

    Steve Jobs is an a**hole that doesn’t care about his customers.We at Virgin are always thinking about our customers and providing them with a stylish and valuable service, which is why we started the whole pre-paid concept in the States with Virgin Media. (You’re welcome, America.)More background on me and the Steve’s here…http://fakerichardbranson.b…Warm regards,Sir Dick

    1. fsjisfunny

      you are not funny. lame!

  3. vincent everts

    Fred, I had the same problem. If you add 00000000 or 123456789 as a social security number then you will be automatically enrolled in the pre paid program. I am a dutch alien I did not have a number. The first time I used the social security number of my son which is one year old and who had bad credit.But easier is to go to http://www.iphonehacks.com and get the phone unlocked. Then you can use any sim card you like. Takes about 45 minutes.SincerelyVincent EvertsAmsterdamwww.pczapper.tv

  4. martin

    Call up another agent, said you entered some wrong details, and have them reset the application.Then try again, and if you get the above, when you call just say you live in another country.Your US CC details have to match up though, when used with a foreign card activation didn’t go through.

  5. BWJones

    I have a fundamental problem with having to provide the Social Security # to begin with and would love to see this little requirement done away with.With respect to the iPhone, yeah… I’d love to pick one up, but I dumped AT&T years ago because of poor customer service and usurous rates for international coverage. T-Mobile has been a much better experience, yet I still *hate* the contracts. Why don’t we have a system like that in Europe?

  6. Lance Weatherby

    AT&T wireless is a mess.We have been trying to switch over to their service since Monday because I was gifted an iPhone. They totally screwed up porting my wife’s phone number. Neither her Sprint phone or AT&T phone can send/receive anything and they said it was going to be that way for 3 to 5 days. “Nothing we can do about it” is what the CSR told her. Unacceptable.

  7. John

    Fred,I understand you’re angry, but think it’s wrong to assume everyone with bad credit is a deadbeat.You’re right about the carriers. They’re really scrambling now to get those networks locked down, look at the Verizon case. http://www.alleyinsider.com…Regards,John

    1. fredwilson

      same apology to you John. bad choice of words.

  8. Peter

    I recently tried to get my home and cell phone bill combined by AT&T. After a credit check(?), they told me I do not qualify. I am in the credit business and know my credit very well. There is no reason they should have declined me. They are buffoons and will not survive with this kind of customer service. By the way, they also never sent me a declination letter, as per the FCRA within 30 days outlining why they declined me based upon my credit report. I can sue or report them to the FTC and am looking into this.

  9. Jonathan Peterson

    AT&T is the entire reason I won’t buy an iPhone.

  10. Andrew Parker

    I have no where to go! I’m planning on leaving Verizon at the beginning of October in protest over their lawsuit against the FCC. I had Sprint for 4 years and their cust service made me feel like an untouchable, so I won’t go there. Your AT&T experience has convinced me I shouldn’t go there. All that’s left is T-Mobile, but their network is atrociously bad. I have no options left.Time to buy a Nokia N800 and load it with Skype. Jumping from wifi island to wifi island around the city has the great price of free and would comparable service quality to T-Mobile 😉

  11. Eric

    I’ll stick with Verizon and my 8830 :)Way to stick it to ’em Fred.

  12. Hagos Mehreteab

    @jonathanpetersonI’m right there with you. I would have bought iPhones for our entire staff by now if it hadn’t been for AT&T.

  13. Niki Scevak

    I’d have to re-iterate that the loosely thrown sentence at the end, “you cannot get a prepaid plan from AT&T unless you are a deadbeat,” is a little demeaning. Being originally from Australia, and arriving 4 years ago, I can say how frustrating (and unique I might add) the American credit system is (basically having to put house-deposits down to rent an apartment in Manhattan). And that not all people who don’t have American credit histories, primarily those ‘international’ (the word still is unironic in America, isn’t America part of the world too?) people who are here.

    1. fredwilson

      sorry Niki. bad choice of words.

  14. Nate Westheimer

    “Steve Jobs doesn’t care about rich people…”?Cut the mic.Fred, I just want to point out that many people whom I would not consider “deadbeats” have bad credit (often for unexpected medical bills).

    1. fredwilson

      sorry for using that term Nate. i was annoyed when I wrote the post and my choice of words wasn’t so great.

  15. ErikSchwartz

    I pre-ordered a 16 gig touch. There’s some stuff coming out about it that I don’t like (like crippling of apps). There’s some stuff I really wish it had. If it had bluetooth and could communicate with my phone, that would rock.I’ll currently have a treo 700p, I’ll give that up for a krzr or a rokr. Then get an EVDO card for my laptop for anywhere internet.

  16. howardlindzon

    just sign up for lifelock and than retry

  17. Jon Kelly

    Between the customer service issues and the network quality, it’s a wonder that they get any customers. I guess if you live in one of the (few) areas where their coverage is decent, don’t travel and don’t mind how you are treated, you’re OK!

  18. Jason Preston

    I’ve always disliked AT&T, ever since I dropped them about four years ago for T-mobile, where I’ve been quite happy since. I definitely want an unlocked iPhone, but it sounds like in order to unlock it you need to activate it with AT&T first?

  19. Not a deadbeat

    Dear jerk,Not everyone with bad credit is a deadbeat. Count yourself among the lucky ones who haven’t had massive medical bills or who suddenly lost a job and was unable to find another right away.When this happens to you, it ruins your life. Not only are you not allowed to get loans for car, house, or school, but you can’t do simple things like rent apartments, and people are starting to be denied jobs when employers do a credit check. THAT is discrimination, so quit your fucking whining.So I hope you get into a major car accident and have lingering problems that your insurance won’t cover and you are unable to pay your bills. I’m sick and tired of the “it can’t happen to me” attitude that jackasses like you carry around. It CAN happen to you.

    1. fredwilson

      i’ll say it for a fourth time. sorry about the poor choice of words.

  20. Not a deadbeat

    And apologies, that was supposed to say I hope you DON’T get into an accident. I may be pissed, but I’m not inhumane.

    1. fredwilson

      me too 🙂

  21. jackson

    I think they are onto you, do you hear ‘beeps’ when on your phone? Do you notice people walking on the street behind you? Do you go to sleep at night, then wake up in the morning?If so, it’s likely that AT&T and SteveJobs have people watching you.I’d lay low for a while – go underground.I’ll contact you by the usual methods when it’s safe to resurface.

  22. Jeff

    I’ve read of this workaround, but I’m not sure it works. Register the phone and use 999-99-9999 to set up your account. You’ll fail the credit check and be given the prepaid option.I couldn’t agree more on AT&T. I just moved over to a Helio Ocean (Sprint network) and the call quality is much, much better. One bar gets me a well connected, clear call. One bar on AT&T and I wouldn’t even bother answering, I knew it would drop the call.

  23. Tammie

    So what are you going to do with your iPhone? Unlock it and try it on T-Mobile?

    1. fredwilson

      can’t unlock until i activate, at least that’s what i’ve read

  24. David

    Fred, AT&T is the ONLY reason I refuse to get my iPhone luvin’ on!

  25. Evelyn Rodriguez

    Totally agree AT&T sucks (currently I’m a very dissatisfied customer). I’d walk out on my contract in a heartbeat if there were anything DECENT to jump ship to. (Already tried a few.)I like Andrew’s suggestion to unplug from *all* carriers. Is there any way VC’s can aid in getting WiFi ubiquitous so we Skype?

  26. Stephen L. McKay

    To “Not a Deadbeat”. While Fred’s remark may sting to some, please remember that those who have never been there don’t know. From what I understand, Fred could pay cash for neurosurgery, if he needed it, and I certainly hope with all my heart that he never does.I went from rags to riches, back to rags, and then made a comeback again in my 47 years on the planet. It took me 7 years to re-build my credit. It was hard work, but I still realize that even though some of the situation that got me in that place was out of my control, part of it surley was.Don’t be so hard on Fred. I’m sure he didn’t mean it the way you took it. I didn’t.

  27. Stephen L. McKay

    To “Fakerichardbranson”I looked at your site, and agree with Fred. Your the kind of jerk that makes space shuttle jokes. The sort I walk away from in bars. Won’t get into a dialog on Freds blog, but you are, well, what was it Fred called you?

  28. Genevieve

    Please forgive me for being so harsh, but I can’t stop thinking about the lack of perspective in this post; this seems like a spoiled person’s complaint.Beyond what others have pointed out (and what you’ve graciously apologized for), it’s not only the choice of words… the entire attitude seems over the top. It’s absolutely your right to not use their service. It also seems a bit silly to start throwing around “discrimination” and “illegal” because you can’t get an expensive little gadget to work. You’re a tech blogger with an unusual situation that a few employees at a mediocre phone company didn’t have the authority to handle. This is not a real problem.Next time, if this sort of experience is such an inconvenience, please consider getting some perspective by learning about and then donating (the same amount of money that phone costs) to a charity or an organization that fights actual discrimination and illegal activities. Thank you.

    1. fredwilson

      Genevieve – every ad that runs on this blog, every page view, generates revenue that goes to charities. I give all the money that this blog generates away. so i am sort of doing what you suggest.although it may seem like “rich guy gets upset when he can’t have it his way”, my point was that AT&T is forcing people to pay $1400 (two year contract at $60/month minimum) to use the iPhone unless the fail a credit check.that’s wrong regardless of whether i can afford it or not.Fred

      1. Genevieve

        Fred, thank you for your reply. Please be aware that “donating to charities” vs “getting some perspective about actual discrimination and illegality” are two different things. While I’m glad that you’re doing the first, that does not provide credit for the second. I believe some perspective would have adjusted the attitude of the original post.Unfortunately, the use of terms like “discrimination” and “illegal” distracted from your point. My point is that no one with an understanding, respect, or empathy for those who have really experienced the result of those words would have used them for an issue such as this.

  29. dave

    You will find simple instructions on how to activate and unlock your iPhone without any involvement with AT&T here:http://modmyiphone.com/wiki

  30. Evelyn Rodriguez

    Already commented on the AT&T part of this post. Yet the “deadbeat” statement continued to haunt me, so here goes. Many artists and musicians I know (and I’d wager the majority of the non-picked-up-by-labels indie bands you listen to) don’t have credit. Meaning they’ve not established a credit history “proving” they can pay on time consistently. Reasons vary, but for many artists and activists they choose to NOT be part of any credit system as a matter of principle.Having “no” credit as far as the AT&Ts of the world are concerned might as well be “bad” credit.

  31. jackson

    I think if the default for comments was chronological and not ‘hot’ – whatever that means – you might have only had to repeat your apology twice……..I will say that every deadbeat I know has an iPhone – coincidence? I think not………

  32. Simon Coles

    That’s got to be wrong. I’m a UK citizen who goes to the US on business (so no Social Security ID), and bought an iPhone and once I failed credit check they put me on a pre-paid plan without much problem. Although I’m not in the US much it is still preferable to using my UK phone over there and getting stung with the roaming rates – and the iPhone is a very useful web/mail device around the house.

  33. squay

    I had the same exact thing happen and actually just returned from an AT&T store for the second day, and now have spent over 10 1/2 hours and they placed a hold stating that I could not activate my iphone using a pre-paid plan. After the hold was placed, 5 AT&T employees, 2 supervisors and 3 more managers could not replace the hold, so still have not been able to get an iphone with the pre-paid account (I don’t want to commit to the 2 year contract — am a tech blogger at wize.com). They sent me home with a Tilt, (which I am returning tomorrow) have tried to charge multiple restocking fees, activation fees, and overall the experience was enough to make me say, is the iPhone really worth this???

  34. Melynda

    Don’t try to add your company name to the Yellowbook.com for the free listing…I went on line in October 2007 to ad our a very small company’s name, phone, address and description of business per the “Free Listing” rules. In turn, this generates a soliciation email from an advertising consultant. He wants to maximize our business. I told him my credentials, wife, offfice manager of the business and we were not interested in any additional services, we were only interested in the phone number listing per the Free Listing requirements. I spoke to him in length about how we were not interested and maybe down the road we could consider it. In turn 3 days later, he calls the main number and asks to talk to the owner, my husband, who knew I had contacted YellowBook.com but didn’t know I said no to the additonal paid services. He was a fast talker and got my husband to approve for some additional services on yellowpages.com for $98.00 a month for a 12 month contract. They have his voice recording on tape that he approved of it. Then four months later we start getting a bill for the services. The listing has my personal cell number for the listing and a clip art of their choosing, ugly if you ask me… I call to say this is wrong we didn’t approve of these services. I was told that they had verbal recorded contract, and I got to listen to it. What I am upset about it the advertising consult w/ A T & T after speaking with in length of not wanting or asking for additional services and not respecting my authority at the time, decided to pursue it even further by contacting my husband. Now my husband works in the construction field and he is always going ninety miles an hour and doesn’t sit at a desk where he can contemplate all the aspects….. and of course he listens about half of a conversation. He approves of the contract as he is recalls it $98.00 a year not a month…even though he states on the recording a month. I am not disputing the verbal recording contract, what I am disputing and upset is that I had the authority and I am the person who pays and collects the money in the business and knew at the time, we were not able to set ourselves up for that expense, but the advertising consultant needed his commission so badly that he didn’t respect my word and pursued it on until he got what he wanted. Now, we are responsible for paying for a service for 12 months that we don’t want or will generate any business for us. Since we added our name in October 2007 for the free listing… we haven’t gotten any customers saying that’s how they found us. So, the statement goes to say nothing is for free…its right now it will be $1176.00 and can automatically renew…we caught this injustice a few days into the billing cycle not months and not trying to get something for nothing. They would rather us be mad and upset and just pay it then trying to win us over back in buying their products and services.I quit buying At &T products over 10 yrs ago due to their customer care, I don’t even have a home/business phone because of AT & T buying SWBT. That’s how serious I am about not using At&T. They are big company who disregards indivual’s NO and keeps going until they find someone who says yes!Melynda Oliva