We have just received word that T-Mobile will be returning up to $90 million in refunds, where these refunds will concern the billing of customers for cellphone text services that they did not order in the first place, thanks to a settlement with federal regulators. According to an announcement made by the Federal Trade Commission, this particular practice is known as “cramming”, and with T-Mobile being the fourth-largest U.S. cellphone company, they have been slapped with $18 million in fines to the 50 states and the District of Columbia, while the Federal Communications Commission would receive $4.5 million in fines from T-Mobile. AT&T as well as Sprint were fined $105 million each in the past for “cramming”, too.
The FTC did sue T-Mobile in July earlier this year, throwing the accusation of the mobile carrier billing customers for subscriptions to text services such as the monthly horoscopes that cost $9.99, in addition to celebrity gossip updates which customers shunned and did not authorize in the first place. T-Mobile picked up anywhere from 35% to 40% of the charges, despite receiving alerts from customers that they were bogus.
FCC Chairman Tom Wheeler shared, “Today’s enforcement action demonstrates the Commission’s continuing commitment to work with our federal and state counterparts to protect consumers.When consumers are harmed by carriers’ unscrupulous business practices, we will marshal our collective resources to seek accountability and obtain positive reforms. We are pleased to have partnered once again with the FTC and the attorneys general for all 50 states and the District of Columbia on a settlement that will bring meaningful relief to millions of consumers.”
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