Feeds

T-Mobile US preps for $43 MEEELLION shower of gold on cram victims

Network braces for quarterly hit from repaying unwanted SMS charges

Secure remote control for conventional and virtual desktops

As American regulators at the FTC crack down on mobile bill "cramming" scams, T-Mobile US has ring-fenced at least $43 million – to refund customers who were fraudulently charged for premium SMS services.

The network said in its quarterly earnings report that the expected payouts were among the non-recurring factors it listed for service revenues over the three months ending June 30.

T-Mobile US stopped offering premium SMS services in 2013. Since then, the company has operated a refund program which allows users to seek out payments for unwanted or deceptive premium services they may have been billed for.

The refund charges were part of an otherwise strong quarter for T-Mobile US. The company added 1.5 million new customers on the quarter, and $7.2bn in revenues, up 15 per cent over the same period last year. Adjusted EBITDA stood at $1.45bn, up 14.7 per cent year on year. The network today has 50.5m customers on its books.

Known as "cramming," the practice of tricking users into signing up for premium messaging services can be a highly lucrative business for fraudsters. Often disguising subscription services behind the promise of free stuff or special offers, unscrupulous companies can sign users up for horoscope text message subscriptions and the like, which are then added to the user's monthly mobile bill.

If the customer does not closely read their statements, it can result in hundreds of dollars being paid out over the length of the subscription.

The FTC in particular has been aggressively pursuing the companies running cramming scams while also admonishing the carriers that benefit by taking a cut of the revenues. Earlier this year the FTC alleged that T-Mobile US made "hundreds of millions of dollars" by enabling cramming schemes.

The company has denied the FTC's allegations, saying that the commission overstated the revenues collected from the premium SMS services. T-Mob US CEO John Legere has suggested that company was being singled out at the behest of lobbyists representing competing carriers. ®

Secure remote control for conventional and virtual desktops

More from The Register

next story
Download alert: Nearly ALL top 100 Android, iOS paid apps hacked
Attack of the Clones? Yeah, but much, much scarier – report
Broadband sellers in the UK are UP TO no good, says Which?
Speedy network claims only apply to 10% of customers
Virgin Media struck dumb by NATIONWIDE packet loss balls-up
Turning it off and on again fixes glitch 12 HOURS LATER
Yahoo! blames! MONSTER! email! OUTAGE! on! CUT! CABLE! bungle!
Weekend woe for BT as telco struggles to restore service
Fujitsu CTO: We'll be 3D-printing tech execs in 15 years
Fleshy techie disses network neutrality, helmet-less motorcyclists
Facebook, working on Facebook at Work, works on Facebook. At Work
You don't want your cat or drunk pics at the office
Soz, web devs: Google snatches its Wallet off the table
Killing off web service in 3 months... but app-happy bonkers are fine
prev story

Whitepapers

Why cloud backup?
Combining the latest advancements in disk-based backup with secure, integrated, cloud technologies offer organizations fast and assured recovery of their critical enterprise data.
A strategic approach to identity relationship management
ForgeRock commissioned Forrester to evaluate companies’ IAM practices and requirements when it comes to customer-facing scenarios versus employee-facing ones.
How to determine if cloud backup is right for your servers
Two key factors, technical feasibility and TCO economics, that backup and IT operations managers should consider when assessing cloud backup.
Reg Reader Research: SaaS based Email and Office Productivity Tools
Read this Reg reader report which provides advice and guidance for SMBs towards the use of SaaS based email and Office productivity tools.
Choosing a cloud hosting partner with confidence
Download Choosing a Cloud Hosting Provider with Confidence to learn more about cloud computing - the new opportunities and new security challenges.