T-Mobile Slapped With FTC Lawsuit for Phony Charges
Some T-Mobile customers have paid extra fees for text-based services they didn’t agree to include in their cellphone charges, and now the Federal Trade Commission is on the mobile giant’s case with an inquiry and a lawsuit.
T-Mobile isn’t the only carrier to engage in the shady practice known as “cramming,” or surreptitiously adding services to consumers’ bills without their knowledge or permission and profiting from same. In fact, according to the FTC, the company might have made off with hundreds of millions of swindled dollars. But as the Associated Press reported Tuesday, T-Mobile’s management isn’t owning up to the charges (via Bloomberg Businessweek):
The complaint alleges that T-Mobile billed consumers for subscriptions to premium text services such as $10-per-month horoscopes or updates on celebrity gossip that were never authorized by the account holder. The FTC alleges that T-Mobile collected as much as 40 percent of the charges, even after being alerted by other customers that the subscriptions were scams.
“It’s wrong for a company like T-Mobile to profit from scams against its customers when there were clear warning signs the charges it was imposing were fraudulent,” said FTC Chair Edith Ramirez in a statement. “The FTC’s goal is to ensure that T-Mobile repays all its customers for these crammed charges.”
In a statement, T-Mobile called the allegations “unfounded and without merit.”
“T-Mobile is fighting harder than any of the carriers to change the way the wireless industry operates, and we are disappointed that the FTC has chosen to file this action against the most pro-consumer company in the industry rather than the real bad actors,” said John Legere, the company’s CEO, in a statement.
Legere’s statement comes off a bit like the whiny kid whose bully friends put him up to stealing one cookie while they made off with the bag, but regardless, if T-Mobile is in fact “the most pro-consumer company” out there, we’d hate to see what the rest of them have been up to in comparison. Meanwhile, read your cellphone bills closely, people.
–Posted by Kasia Anderson