Mobile telephone customers who may have been charged for phone and text messaging services they never requested are being advised to find out if they are eligible for their portion of $267.5 million in refunds.
Settlements with the country’s four largest wireless carriers have been reached over the past year after the Federal Trade Commission and Federal Communications Commission launched investigations into so-called “cramming” scams.
While it’s too late for AT&T customers whose refund deadline came and went on May 1, there’s still time for T-Mobile, Sprint, and Verizon customers to get a cut of the settlement. The clock runs out for T-Mobile customers on June 30. Sprint Mobile and Verizon Wireless customers have until Dec. 31.
These cases revolve around unauthorized charges for such items as ring tones, cell phone wallpaper, or “premium” text messages about sports scores, celebrity gossip, flirting tips, or daily horoscopes. U.S. Sen. Richard Blumenthal said it’s a list of products and services that millions of customers “never requested, never consented to receive, never wanted.”
Blumenthal said charges were concealed in mobile phone bills under headings that did not clearly identify the third-party provider and in descriptions that ranged from nonspecific to completely unintelligible. He said the wireless carriers took a 30 to 40 percent cut of the third-party profits.
Blumenthal is urging T-Mobile customers to act fast to take advantage of at least $90 million in restitution available through the settlement.
He said many consumers were bilked out of $9.99 per month over as many as five years.
Bill Efron, northeast regional director of the Federal Trade Commission, said the settlement with T-Mobile requires the company to offer full refunds to its current and former customers who were charged for unauthorized texting services between June 2010 and December 2014.
If customer claims don’t reach the $90 million threshold, the balance must go to the FTC to be applied to consumer education or other uses.
Efron said it is not known how many T-Mobile customers have already filed for refunds. Under the terms of the settlement, the company must submit a report on refund claims by Nov. 1.
ConnPIRG State Director Evan Preston, who advocates for consumers, said customers need to request a refund now to protect their rights going forward.
“The more people who seek these refunds, it’s a better incentive to companies in the future to do the right thing and to charge people fairly,” Preston said. “Consumers are entitled to understand what they’re being charged for and only face costs from things that they have chosen to buy.”
According to the FTC, T-Mobile must pay $18 million in fines and penalties to the attorneys general of all 50 states and the District of Columbia and $4.5 million to the FCC. It also requires the company to get customers’ consent before putting third-party charges on bills. The company must ensure that consumers are notified of any third-party charges and provide them with information about the option to block third-party charges.
AT&T agreed to a $105 million settlement in October. Efron said the FTC has received over 5 million claims from consumers. The settlement administrator is working on finalizing the list of consumers that will receive refunds, he said.
The FCC announced in May that Verizon Wireless must pay out at least $70 million to affected customers while Sprint Corporation customers are entitled to at least $50 million.
Claims websites have been set up for T-Mobile, Sprint and Verizon. Consumers with questions about the refund programs can call 1-855-382-6403 for T-Mobile, 1-877-389-878 for Sprint or 1-888-726-7063 for Verizon.
