ATT will have to pay $105,000,000 to settle charges by the Federal Communications Commission and the Federal Trade Commission because their billing practices for millions of wireless customers were deceptive. The type of charges the ruling is referring to are commonly known as “cramming” charges, which are normally third party billing arrangement that allow ATT (and other carriers) to put the charges for these services right on your wireless invoice.
Telecom Over Charging
These charges are labeled deceptively with such misleading service descriptors as premium text, high-speed internet or unlimited long distance service, when in fact they are simply for services such as daily horoscope, news feeds or advice. When added to your normal service invoice, these bogus charges are paid by the trusting and unsuspecting customer.
FCC Chairman Tom Wheeler said some 20 million subscribers are caught up each year in so called cramming. “For too long consumers have been charged on their phone bills for things that they did not order,” Wheeler said at a press conference in Washington. He said millions of customers each year are caught by third-party charges they did not order. That has meant “hundreds of millions of dollars,” he said. “It stops today for ATT. This $105 million settlement is going to put money back in the wallets for consumers who are victimized by the practice. Millions of AT&T customers will be able to reclaim moneys that were fraudulently taken out of their wallets.”
Moving forward ATT and all carriers will have to:
* Clearly disclose customers’ ability to block all third-party charges;
* Notify customers each time a third party is placing a premium text messaging service charge on their account;
* Provide customers who dispute a third-party charge – if the charge is not older than six years and has not been previously refunded – with a full refund or access to the customer’s express consent of the charges;
* Implement a new tracking system to monitor customers’ disputes of third-party charges; and
* Cooperate with future multistate investigations – particularly states’ subpoena requests for information from the new tracking system.
This practice was very common in the local service arena but as the number of consumers with local phone service dwindles the practice has moved to the exploding wireless user population.
We should all take a moment and feel good about our government oversight agencies and the good work they have done here today for all of us.
[author_bio username=”Ken” name=”yes”]