Over Data Cramming Allegations
Attorney General George Jepsen and state Department of Consumer Protection (DCP) Commissioner William M. Rubenstein announced today that Connecticut, along with 49 other states and the District of Columbia, has reached a settlement with mobile telephone company T-Mobile USA to resolve allegations that the company improperly engaged in "data cramming."
The states, along with the Federal Trade Commission (FTC) and Federal Communication Commission (FCC), alleged that T-Mobile was billing consumers for premium text message subscription services (PSMS) that they had not signed up for or otherwise agreed to receive– a practice known as "data cramming." These charges, typically $9.99 per month, were added to consumers' monthly bills for services provided by a third-party, such as daily horoscope readings, trivia and sports updates.
The $90 million global settlement provides refunds for affected consumers and an $18 million payment to participating states, of which Connecticut will receive $241,426.96. In addition, the settlement prohibits T-Mobile from engaging in data cramming activities in the future.
T-Mobile is the second mobile telephone provider to enter into a nationwide settlement to resolve allegations of cramming. Attorney General Jepsen and Commissioner Rubenstein announced a similar, $105 million settlement with AT&T in October of this year.
“I am glad to see T-Mobile discontinue a practice that has deceived and financially harmed unwitting consumers,” said Attorney General Jepsen. “We take allegations of data cramming very seriously. We are encouraged that T-Mobile will refund consumers for unwarranted charges and reform the manner in which consumers are billed in the future.”
“This settlement is another important win for consumers, but the news should also serve as a reminder to consumers everywhere --be vigilant about carefully checking your bills for charges that you don’t recognize and did not authorize,” Rubenstein said.
Under the terms of the settlement, T-Mobile must provide each victim of cramming who files a claim under its premium SMS Refund Program an opportunity for a full refund.
Consumers can submit claims until June 30, 2015 under the program. Consumers can learn more about the program as well as refund eligibility by visiting www.t-mobilerefund.com or by calling call the Refund Administrator at (855) 382-6403. Consumers may also request a free account summary that details PSMS purchases on their accounts.
The settlement requires T-Mobile to bill for third-party charges only if such charges have been authorized by consumers, improve the manner in which it places charges on consumers' mobile phone bills and enable consumers to block the placement of these charges on their bills. Data cramming can affect both land and mobile telephone lines and can be easily overlooked on monthly bills. The charges are often disguised in bills as a "service fee" or "monthly charge."
Data cramming affects approximately 20 million consumers totaling into the millions of dollars in unauthorized charges each month, according to the FCC. Consumers should thoroughly review their monthly bills and examine all charges carefully. If any charges appear to be unwarranted, consumers should promptly contact their telephone providers to complain.
Assistant Attorneys General Michele Lucan, Brendan Flynn and Philip Rosario, head of the Attorney General's Consumer Protection Department, are assisting Attorney General Jepsen with this matter.
Click here to the read the settlement.
Office of the Attorney General:
Robert S. Blanchard
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