State Investigation Into Connecticut AT&T Store Business Practices Deepens

STAFFORD, CT — Connecticut Attorney General William Tong Monday announced a more intense investigation into AT&T over "unauthorized charges added to customer accounts."

The civil investigation follows criminal charges filed against a former employee of an authorized AT&T dealer in Stafford over adding unauthorized lines and plans to customer accounts in "a ploy" to earn bonuses and commissions.

“In multiple instances, AT&T employees are alleged to have opened fraudulent lines and added unauthorized charges to win bonuses. We need to understand whether these were isolated bad actors, or whether there is something about AT&T’s practices that is incentivizing or enabling more widespread fraud. If you have information relevant to this investigation, we want to hear from you. And, if you are a customer, please double check your accounts, and report any unauthorized charges,” Tong said.

In January, Katie Ann Barnaby, 35, was arrested via a warrant from Rockville Superior Court. She was charged with with computer crime in the third degree by state police and is accused of illegally tacking on charges to customer accounts while employed at a local mobile phone store.

A customer filed a formal complaint with state police in February 2024, but the case dates back to Dec. 4, 2021, when a customer purchased a Samsung phone on a payment plan at the AT&T store at 787 West Stafford Road in Stafford.

According to a warrant, the customer began noticing that his bills were larger than the sales agreement, including unauthorized protection plans and other features. The warrant cites about 30 similar complaints in all and an internal investigation by AT&T. A sales consultant at a Manchester AT&T store told state police that, when she was filling in at the Stafford store, she noticed Barnaby accessing customer accounts without authorization and "adding lines" to the accounts to "generate commission-based profits."

Staffers also suspected Barnaby of retaining trade-ins for herself and selling them online, according to a warrant.

In 2022, Barnaby switched to a store in Willimantic.

The original complainant from Stafford sustained unauthorized charges totaling $2,041.71 from Dec. 2021 to February 2022 and Barnaby made the store switch six months later, according to a warrant.
AT&T internal investigation, eventually obtained by state police via a search warrant, backed up the customer complaints, state police said.

She was officially employed by an authorized AT&T retailer and was fired on July 15, 2022, according to a warrant.

In July, she was charged with third-degree computer crime six times over while being accused again of fudging customer accounts to earn sales commissions.

Tong said anyone with information relevant to the investigation is "encouraged" to file a complaint here.

"This is precisely the sort of inter-agency cooperation that benefits Connecticut residents. I am pleased that Connecticut State Police expertise with financial crimes, fraud, and computer crimes played a critical role in this investigation," Department of Emergency Services and Public Protection Commissioner Ronnell A. Higgins said. "I look forward to future cooperation between DESPP, the Connecticut State Police, and Attorney General Tong."

The civil investigative demand sent to AT&T seeks information on the company’s footprint in Connecticut, all complaints from Connecticut consumers regarding unauthorized charges, as well as its procedures to prevent unauthorized charges and services, what steps the company takes when an unauthorized charge is reported, and details regarding the company’s sales compensation plan policies. Finally, the civil investigative demand seeks all documents relating to responses to other regulatory actions and law enforcement investigations, both civil and criminal.

Barnaby's cases cases remain pending in Rockville Superior Court. According to the arrest warrant for Barnaby, State Police found similar fraudulent schemes in Michigan, where multiple store managers are accused of directing employees to add certain unauthorized services to all customer accounts to earn bonuses ranging from $300 to $3,000, tied to achieving a 90 percent "close rate" on those services.

The civil investigative demand further seeks information concerning the employment of Barnaby and records of any company investigation into her unauthorized charges in Connecticut, Tong said.

Assistant Attorney General Joseph Gasser and Michael Wertheimer, Chief of the Consumer Protection Section, are assisting the Attorney General in the matter.