T-Mobile US to refund $90m for bogus charges: Un-Carrier to Un-Crammer
Scram, cram scams, thank you, ma'am
T-Mobile US will pay out $90m to settle cramming allegations raised by the US trade watchdog.
The Federal Trade Commission (FTC) said the telco will dish out the money as refunds to all customers who were pinned with hidden mobile cramming charges since 2010. The company – which portrays itself as the do-no-wrong Un-Carrier – may have to cough up additional fines, too.
Back in July, the FTC, along with US comms regulator the FCC and attorneys representing all 50 states and the District of Columbia, alleged that T-Mobile US allowed third parties to sneak monthly charges onto customer bills through a process known as cramming.
These charges were often hidden as offers for junk services like horoscopes, love tests or trivia, and recurred monthly. After charging subscribers, T-Mob would often take a cut of the fees for itself.
According to the FTC, T-Mobile US was not only complicit in the practice of cramming, but also continued to allow the charges to be added even after the shady cramming companies were hit with criminal complaints.
T-Mob, for its part, shut down all possibility of cramming when it killed off premium-priced texts in 2013. Since then, the biz has instituted a refund program for customers who believe they were hit with bogus charges.
That program is about to get much, much larger with the FTC settlement. T-Mobile US must now contact all customers who received premium charges since 2010 and notify them of the refund program. The carrier will also agree to take steps that prevent any future cramming operations from appearing on its network.
The FTC and FCC hope the settlement will send a message to other telcos in the US that any and all cramming operations need to be shut down and set right immediately.
"We have put carriers on notice that they will be held accountable," said FCC enforcement bureau director Travis LeBlanc.
"We have a zero tolerance policy against billing practices that cheat consumers into paying for services they did not want or authorize." ®