The Federal Trade Commission (FTC) made history yesterday when it announced it had filed charges against T-Mobile USA, Inc., (T-Mobile) for its part in cramming bogus
charges billed by third parties onto customers’ bills. The complaint, dated July 1, 2014, alleges the company knowingly allowed charges for “premium” SMS subscriptions that,
in some cases, were never authorized by its customers.
The FTC charges that the fourth largest wireless network carrier received up to 40 percent of the total amount charged to customers for monthly subscriptions—often $9.99 per subscription—of third party content such as ringtones, wallpaper, horoscopes, celebrity
gossip, and flirting tips. According to the FTC complaint, T-Mobile deceptively placed third party charges along with other service charges, for instance texting, or categorized them under headings such as “use charges” and “premium services”. This made it
difficult for customers to identify the charges, the fact that it was a subscription, and who was billing them. Even after receiving customer complaints about the charges, alerts from industry auditors warning about certain companies engaged in cramming, as
well as press releases, class action suits, state Attorney General settlements, and FTC actions against crammers, they continued to cash in by continuing these billing practices.
The complaint goes on to claim that, in many cases, when customers complained about the charges to T-Mobile, they were flatly denied refunds for the unauthorized charges, given only partial refunds, or told to contact the third party merchant directly with
their dispute. The FTC is seeking to have the company stop engaging in cramming, refund its customers, and have T-Mobile give up the profits made from cramming.
Business Consumer Alliance has processed complaints against T-Mobile and some of them have gone unanswered. The complaints filed against the headquarters can be reviewed
on T-Mobile’s reliability report.
While this is the first case of the FTC filing against a wireless provider for cramming, the FTC has filed several complaints against other mobile cramming operations, such as Jesta
Digital.
Business Consumer Alliance urges all customers to thoroughly review their monthly bills and check all charges. If you find any charges you are unfamiliar with or did not authorize, contact your provider and the billing party immediately. Consider blocking
third party charges. Your provider may offer this service for free.
For more information on mobile cramming and tips on what you can do about unauthorized charges, visit our resource guide on “Mobile Cramming”. If you have a problem with
your provider or any other business,file a complaint with Business Consumer Alliance.
About The Author:
Nicole Pitts is a Senior Business Analyst and Editor for Business Consumer Alliance. She has been with the organization for 12 years and specializes in report writing, business evaluation, and investigations. Nicole corresponds with businesses regarding
complaint trends and provides suggestions to help them alleviate problem areas that may cause concern. She also conducts advertisement reviews, reports on government enforcement actions, and assists government agencies in obtaining information. She enjoys
reading, movies, and spending time with her family. Nicole can be reached by email at npitts@businessconsumeralliance.org.