T-Mobile Fights FTC Cramming Charges, Petitions FCC

By Michelle Maisto  |  Posted 2014-07-12 Print this article Print

The FTC believes that T-Mobile received 35 to 40 percent of the total amount of charges for things like "flirting tips … or celebrity gossip," which typically came at a cost of $9.99 per month.

"It's wrong for a company like T-Mobile to profit from scams against its customers when there were clear warning signs that charges it was imposing were fraudulent," FTC Chairwoman Edith Ramirez said in the complaint. She added that the FTC intends to make T-Mobile repay all of its customers for the charges.

T-Mobile called the complaint "without merit."

"T-Mobile stopped billing for these Premium SMS services last year and launched a proactive program to provide full refunds for any customer that feels they were charged for something they did not want," T-Mobile CEO John Legere said in a statement. "T-Mobile is fighting harder than any of the carriers to change the way the wireless industry operates."

Not all of the third-party companies that the carriers used to handle billing "acted responsibly," Legere said. Those providers should be held accountable, and "the FTC's lawsuit seeking to hold T-Mobile responsible for their acts is not only factually and legally unfounded, but also misdirected," he added.

Two days later, seemingly still fuming, Legere tapped out a follow-up, writing that the FTC sensationalized the story at the expense of T-Mobile's reputation, as well as his own.

"T-Mobile and I stand for one thing: doing right by consumers," he wrote. "It is fundamental to who I am, the type of company I run, and the industry changes we are forcing, and it's at the core of our people."

He went on to make three points. First, "T-Mobile is not participating in any form of cramming, stuffing charges for un-purchased services, or trying to be anything less than totally transparent with each of our customers."

Second, he promised to keep T-Mobile's pledge to bill customers only for what they want and what they have purchased. Third, T-Mobile has created a refund program and will "double down" on its outreach efforts to make sure all potentially affected customers are reached and refunded.

"It's important to me that consumers know that T-Mobile can always be counted on to do the right thing," Legere added.

The commission vote authorizing the filing of the complaint, the FTC added, was 5-0. 

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