By Paul Muschick, The Morning Call (Allentown, Pa.) (TNS)
Sprint Corp. and Verizon Wireless have agreed to refund customers to settle national investigations alleging they allowed their billing systems to be used by other companies that “crammed” unauthorized charges onto customers’ bills.
Sprint and Verizon will pay a total of $158 million in refunds and fines under settlements with the Consumer Financial Protection Bureau, the Federal Communications Commission and the attorneys general of all states.
“Cramming is a deceptive practice that exploits consumers,” Pennsylvania Attorney General Kathleen Kane said in a statement. “It is particularly insidious because consumers are charged for services they never ordered.”
Verizon will pay $90 million and Sprint will pay $68 million. Of those amounts, Verizon will pay $70 million in customer refunds and Sprint will pay $50 million. The rest of the money will be paid to state and federal authorities.
How much each customer may receive will be determined case-by-case. The settlements are pending approval in federal court. You can reach the Verizon settlement administrator by phone at 888-726-7063 and the Sprint settlement administrator at 877-389-8787.
Cramming occurs when a company uses your mobile or landline phone bill like a credit card and adds charges for services such as trivia, ringtones and horoscopes that you didn’t agree to. The phone companies benefit because they are paid by the other companies to provide billing services.
“The lack of oversight by Sprint and Verizon allowed the vendors to have nearly unfettered access to consumers’ wireless accounts,” the Consumer Financial Protection Bureau said in a statement. “The billing systems for premium messages attracted and enabled unscrupulous merchants who, in some cases, only needed consumers’ phone numbers to cram illegitimate charges onto wireless bills.”
Customers can get charged by responding to vague spam text messages or emails, or by clicking on ads that ask you to enter your cell phone number. Charges can be one-time or occur every month. The amounts can vary and often are vaguely defined and hard to identify on bills, which is why you should check your bills closely each month.
T-Mobile and AT&T entered similar nationwide settlements last year. All four major mobile carriers no longer bill customers for “premium” subscription text message services.
Paul Muschick of The Morning Call (Allentown, Pa.) helps consumers fight errors, incompetence and arrogance by businesses, governments and institutions.
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