Updates to our Terms of Use

We are updating our Terms of Use. Please carefully review the updated Terms before proceeding to our website.

Friday, June 21, 2024 | Back issues
Courthouse News Service Courthouse News Service

AT&T Customers to Get $80M for ‘Cramming’

(CN) - As part of a $105 million "mobile cramming" settlement with the Federal Trade Commission on Wednesday, AT&T Mobility will pay $80 million in consumer refunds.

The settlement, filed simultaneously with a complaint in Atlanta, Ga., in involves all 50 states and the District of Columbia. In addition to the refunds, AT&T will pay $20 million in penalties to the states and D.C., plus a $5 million for the Federal Communications Commission.

AT&T Mobility's cramming, as alleged in the complaint, involved its practice of charging customers up to an extra $9.99 a month for unauthorized text-message subscription services such as wallpaper, trivia, horoscopes, celebrity gossip and love tips. The settlement is the first on a national scale to address mobile cramming practices.

Third-party billing occurs when a phone company bills for services offered by another company, then skims a percentage of the charge. AT&T allegedly kept 35 percent of what it charged customers for the unordered services.

"AT&T had strong reason to suspect that the charges were unauthorized, yet continued to place these charges on its customers' bills," FTC Chairwoman Edith Ramirez said in a statement.

Indiana Attorney General Gregory Zoeller called the case "a good reminder that people should pay close attention to their bills for any questionable fees or extra charges."

Third-party charges can be hard to identify on consumer bills. AT&T listed these charges as "AT&T Monthly Subscriptions", the FTC said.

The FTC has placed a significant focus on mobile cramming since 2013. T-Mobile US Inc. is still fighting similar charges filed against it in July, and Amazon.com also faces a similar complaint involving its Kindle Fire tablets.

Consumers can get AT&T refund information at www.ftc.gov/att or by calling (877) 819-9692.

Categories / Uncategorized

Subscribe to Closing Arguments

Sign up for new weekly newsletter Closing Arguments to get the latest about ongoing trials, major litigation and hot cases and rulings in courthouses around the U.S. and the world.