Overbilling Texans Will Cost Website $2 Mil.

(CN) - An Arizona company agreed to pay Texas $2 million to settle allegations it made unauthorized and excessive charges on wireless phone bills.

The state sued Eye Level Holdings dba Jawa, Cylon LLC and two individuals in Travis County District Court last year for deceptive trade practices.

On Wednesday, the defendants agreed to repay all unauthorized charges to customers, pay the state $2 million, and establish a toll-free telephone number and a website to help all affected customers.

Jawa's current customers all received a text message informing them of the settlement and will continue to receive a message each month that contains service cancelation, pricing and subscription nature of service information, according to the final judgment.

Former customers are advised to review their billing statements for unauthorized charges, prosecutors said.

The defendants also agreed to ask wireless carriers to modify the way their services are disclosed on customer bills, so that the company is identified as Jawa along with an accurate description of the subscription service.

Approximately $810,000 of the settlement will cover attorneys' fees and costs, and $1.19 million will go toward the state's general revenue fund, according to the final judgment.

In settling the suit, Jawa agreed to restrictions regarding premium short message services provided for existing customers and future customers.

For future PSMS sales, the defendants must provide detailed disclosures regarding the costs and terms of services in all aspects of marketing and sales. They must also enact a compliance program, and submit to random, semi-annual assessments conducted by independent auditors who will make sure the defendants do not hide their advertising webpages from regulators and cellphone carrier auditors using "cloaking" technology.

Follow @davejourno

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