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T-Mobile Settles FCC Cramming Charges for $90 Million

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Dec 19, 2014, 12:28 PM   by Eric M. Zeman

T-Mobile today agreed to pay the FTC and FCC a total of $90 million to settle accusations that the company was complicit in allowing third-parties to charge customers for unwanted services. An FTC and FCC investigation found T-Mobile guilty of breaking the law by "engaging in an unjust and unreasonable practice of billing consumers for products or services they had not authorized; and failing to provide a brief, clear, non-misleading, plain language description of the third-party charges on the telephone bills sent to consumers." A minimum of $67.5 million of the fine will be set aside to repay customers who claim they were overcharged. T-Mobile will also pay $18 million to all fifty U.S. states and the District of Columbia, in addition to $4.5 million to the U.S. Treasury. As part of the consent decree, T-Mobile is prohibited from charging customers for third-party PSMS products or services. It also requires T-Mobile to create a system so customers can verify third-party service charges before they appear on bills. T-Mobile will have to block third-party charges for free; make it easier for customers to identify possible fraudulent charges; and train customer service staff to properly resolve customer complaints regarding unauthorized charges. "Cramming is a significant problem," said FCC Chairman Tom Wheeler. "For too long, millions of consumers have been scammed — billed for bogus charges on their phone bills for services they didn’t request. This is unacceptable. Today's settlement is a win for consumers who have been victimized by cramming. It means compensation for T-Mobile customers who were fraudulently billed for third-party services that they did not want or authorize. And it goes one step further. Today’s action will also help protect all of T-Mobile's customers from bogus third-party charges in the future." Sprint was recently sued for similar practices. AT&T settled cramming charges with the FCC for $105 million earlier this year.



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Dec 20, 2014, 8:56 AM

All carriers were doing this

Why is TM's settlement so high compared to much bigger ATT?
At the peak of this cramming, there were 100s of complaints on TM's own company sponsored user forum. I was surprised that TM allowed the victims to expose what was going on - on their own web site. The complaints dealt with CS reps not dealing with the problem once the victims realized they were being crammed.
But some on these forums would have us believe this is all a case of customers trying to get something for free and that no wrong doing took place on the part of any of these carriers.

I guess they have found a platform for their disinformation on ...
Edit: This was supposed to be a direct reply to Zpike's last reply, not the original post.

To start, I'm going to throw this out here since there seems to be some arguments about what cramming is. This is directly from the FTC site:

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