NOTE: This article has been edited from a previous version.

Rogers Communications could face more than $10 million in penalties after an investigation by Canada’s Competition Bureau determined that advertising for the company’s flanker brand was misleading.

“We take misleading advertising very seriously,” federal Competition Commissioner Melanie Aitken said Friday.

“Consumers deserve accurate information when making purchasing decisions and need to have confidence they are not being misled by false advertising campaigns.”

The decision centres on wording used in advertising for Rogers’ low-cost service Chatr. The advertising claimed users would experience “fewer dropped calls than new wireless carriers” and have “no worries about dropped calls.”

Those expressions prompted Wind Mobile, one of three new entrants to Canada’s wireless landscape, to file a complaint to the bureau in mid-September.

“We are calling the big guys on their games and the bureau has done their research and feels there is no discernible difference in the networks,” said Wind chairman Anthony Lacavera.

Lacavera has described the dropped-call claim as “ludicrous,” noting that in other countries when a customer moves from one carrier network to another there is a seamless transition.

In Canada if a customer moves from an entrant’s designated area to roam on an incumbent network, the call is immediately dropped, he said.

In addition to monetary penalties, the bureau is asking Rogers to immediately halt advertisements for Chatr containing the claims about dropped calls.

It also called on Rogers to issue a public clarification and compensate customers who made purchasing decisions made on what the bureau says is misleading information.

Lacavera said “obviously a large number of people have made decisions based on what the competition bureau feels is misleading advertising.”

Ken Engelhart, senior vice president of regulatory, Rogers Communications said the company was “surprised” at the bureau’s decision.. “We have extensive, independent third party testing to validate our claims and we stand by our advertising. We will vigorously defend this action in court.”

The complaint from Wind is not the first that Rogers has faced following the July launch of Chatr. In September, Mobilicity also filed a complaint alleging Chatr’s pricing structure was designed to push new entrants from the market.

The bureau’s current accusations are being brought before the Ontario Superior Court of Justice under the misleading advertising provisions of the Competition Act.

Aitken’s statement also touched on the 2008 spectrum auction that made available frequencies to new players in a market long dominated by Rogers, Bell Canada and Telus.

“The spectrum auction was intended to enhance competition in the wireless sector,” Aitken said.

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“New entrants attempting to gain a foothold in the market should not be discredited by misleading claims made by their competitors.”

With files from The Canadian Press