Richi Jennings

FTC bogus billing accusation: Is T-Mobile now the un-un-carrier?

July 02, 2014 6:11 AM EDT


Break the rules: T-Mobile's mission statement?

John Legere, CEO of T-Mobile USA (NYSE: TMUS) has a legendary knack for publicity stunts. His antics include Twitter-bashing Amazon drones -- a bashing virtually everyone enjoyed (well, perhaps not Charlie Rose). On another occasion, Legere livened up AT&T's somnambulant party for developers by crashing the shindig and getting thrown out -- all while chronicling the adventure for his scads of telco Twitter groupies.

Now, thanks to the FTC, T-Mobile is now experiencing the kind of publicity it doesn't want: Accusations of fraudulent billing with a matching lawsuit thrown-in for good measure.

In IT Blogwatch, bloggers pour over last month's phone bill.

Filling in for our humble blogwatcher Richi Jennings, is a humbler Stephen Glasskeys.

 
Grant Gross receives a "premium" text, at a premium price:

T-Mobile USA made hundreds of millions of dollars by charging customers for purported "premium" SMS subscriptions that, in many cases, they never ordered, the U.S. Federal Trade Commission says.  MORE


 
Shaun Nichols ignores calls from people he doesn't recognize:

[An] FTC suit claims that between 2009 and 2013, T-Mobile US allowed third-party companies to add monthly charges to bills of which T- Mobile collected a 35 to 40 per cent share. When customers complained...T-Mobile often ignored [them] as it was profiting from the charges.  MORE


 
Straight from the horse's -- which is unlike all the other horses -- mouth:

We have seen the complaint filed today by the FTC and find it to be unfounded and without merit.
...
As the Un-carrier, we believe that customers should only pay for what they want and what they sign up for. We exited this business late last year, and announced an aggressive program to take care of customers and we are disappointed that the FTC has instead chosen to file this sensationalized legal action.  MORE


 
Straight from the horse trainer's mouth [You're fired -Ed.]:

In a process known as "third-party billing," a phone company places charges on a consumer's bill for services offered by another company. ... When the charges are placed on the bill without the consumer's authorization, it is known as "cramming."
...
The FTC's complaint alleges that in some cases, T-Mobile was charging consumers for services that had refund rates of up to 40 percent in a single month.
...
The FTC has made significant efforts to end mobile cramming. In the last year...the Commission has filed several lawsuits against alleged mobile cramming operations.  MORE


 
Then, Gregory Karp tries to find a bill that doesn't exist:

Cramming charges are insidious, often escaping the attention of consumers because the amounts are usually small, $2 to $10 per month, and are buried among dozens of line items on a phone bill.
...
In the T-Mobile case, customers' online bills did not show that the charge came from a third party, or that the charge was part of a recurring subscription, the FTC complaint said.
...
Consumers who used prepaid calling plans do not get monthly bills, and the subscription fee was debited from their accounts without their knowledge, the [FTC] said.  MORE


 
Phone companies are a big deal to Kate Tummarello:

The charges against and investigation of T-Mobile come as the company is reportedly in talks to be bought by Sprint, a...deal that would combine the country's third- and fourth-largest wireless companies.  MORE


 
Meanwhile, Steve Kovach knows something we don't:

T-Mobile knew the FTC charges were coming. Announced a few weeks ago it's going to end cramming.  MORE


 

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