Light Reading
T-Mobile CEO calls the case 'unfounded and without merit.'

FTC Charges T-Mobile Made 'Hundreds of Millions of Dollars' in Bogus Charges

Dan Jones
7/1/2014
50%
50%

The FTC is suing T-Mobile over adding bogus charges without the customer's consent, a complaint that the operator is calling "unfounded and without merit."

The Federal Trade Commission filled a complaint Tuesday claiming that the "uncarrier" made "hundreds of millions of dollars" by charging for "premium" SMS subscriptions "that, in many cases, were bogus charges that were never authorized by its customers."

The FTC claims that T-Mobile received anywhere from 35% to 40% of the total amount charged to consumers for subscriptions for content such as flirting tips, horoscope information, or celebrity gossip that typically cost $9.99 per month. The commission alledges that "T-Mobile in some cases continued to bill its customers for these services offered by scammers years after becoming aware of signs that the charges were fraudulent."

You can read the complaint here.

T-Mobile US Inc. CEO John Legere hit back quickly on Tuesday with an open letter responding to the complaint. "T-Mobile is fighting harder than any of the carriers to change the way the wireless industry operates and we are disappointed that the FTC has chosen to file this action against the most pro-consumer company in the industry rather than the real bad actors," Legere writes.

He says that T-Mobile stopped billing for premium SMS services in 2013 and launched a program to "provide full refunds" for any customers that believed they were billed for "something they did not want."

"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," Legere continued. "We are the first to take action for the consumer and I am calling for the entire industry to do the same."

See the T-Mobile response here.

— Dan Jones, Mobile Editor, Light Reading

(6)  | 
Comment  | 
Print  | 
Newest First  |  Oldest First  |  Threaded View
Joe Stanganelli
50%
50%
Joe Stanganelli,
User Rank: Light Sabre
7/4/2014 | 5:09:31 AM
Re: Others?
@DanJones: Compliance with which would only further raise our bills.

"FTC Consumer Billing Protection Fee: $1.97"

or whatever.
DanJones
50%
50%
DanJones,
User Rank: Blogger
7/2/2014 | 2:09:19 PM
Re: Others?
So maybe the FTC should be pushing for clearer billing from all of the operators?
Phil_Britt
50%
50%
Phil_Britt,
User Rank: Light Sabre
7/2/2014 | 11:20:46 AM
Re: Others?
Ariella is right. 

It's very easy for companies to bury things in bills (hey, government does it, too, but that's a whole different issue) that customers don't take the time to examine closely. A dollar or two here and there isn't worth finding, but if stopped early, the problem doesn't mushroom as in this instance
Ariella
50%
50%
Ariella,
User Rank: Light Sabre
7/2/2014 | 8:43:25 AM
Re: Others?
@Joe It's a great temptation to these businesses because most people will not go over everything with a fine-toothed comb or even think it to be worth the time to call and ascertain what the charges are for. (I do, but the phone reps seem really surprised that I bother over what looks like small charges)  I'm sure T_mObile and others liek it have goten away with bogus charges for years. 
Joe Stanganelli
50%
50%
Joe Stanganelli,
User Rank: Light Sabre
7/2/2014 | 2:21:51 AM
Others?
This isn't the first story we've seen like this, and I doubt it will be the last.  Considering the charges on my own phone bills, I suspect (pure speculation on my part, I admit, but still) that other companies are doing the same thing -- the idea being that they expect the eventual settlements and fines, if they are ever caught, will be far less than what they're gaining.

In any case, the lesson here is: Read your phone bill!  Review it carefully!  Make sure you understand it!  Don't put up with any garbage!
DHagar
50%
50%
DHagar,
User Rank: Light Sabre
7/1/2014 | 9:05:20 PM
Re: FTC Bogus Charges for T-Mobile
Dan, obviously highly negative publicity for T-Mobile.  They have provided a very effective response.  It appears the legitimacy of the claim will fall in the timing.  I am certain that it will also cost T-Mobile dearly in both publicity, legal fees and the people who previously didn't claim refunds will now.

They must be trying to make them a "poster child" for false claims; I am certain there are other carriers who have had similar practices, or may still have them.
Flash Poll
LRTV Documentaries
Sprint's Network Evolution

7|24|14   |   14:59   |   (0) comments


Sprint's Jay Bluhm gives a keynote speech at the Big Telecom Event (BTE) about Sprint's network and services evolution strategy, including Spark.
LRTV Documentaries
BTE Keynote: The Software-Defined Operator

7|24|14   |   18:43   |   (1) comment


Deutsche Telekom's Axel Clauberg explains the concept of the software-defined operator to the Big Telecom Event (BTE) crowd.
Light Reedy
Numbers Are In: LR's 2014 Salary Survey

7|24|14   |   1:25   |   (6) comments


Our fourth annual Salary Survey paints a picture of who's hiring, firing, earning, and yearning for a change in the telecom industry.
LRTV Custom TV
Driving the Network Transformation

7|23|14   |   4:29   |   (0) comments


Intel's Sandra Rivera discusses network transformation and how Intel technologies, programs, and standards body efforts have helped the industry migration to SDN and NFV.
LRTV Custom TV
Distributed NFV-Based Business Services by RAD

7|18|14   |   5:38   |   (0) comments


With the ETSI-approved Distributed NFV PoC running in the background, RAD's CEO, Dror Bin, talks about why D-NFV makes compelling sense for service providers, and about the dollars and cents RAD is putting behind D-NFV.
LRTV Custom TV
MRV Accelerating Packet Optical Convergence

7|15|14   |   6:06   |   (0) comments


Giving you network insight to make your network smarter.
LRTV Custom TV
NFV-Enabled Ethernet for Generating New Revenues

7|15|14   |   5:49   |   (0) comments


Cyan's Planet Orchestrate allows service providers and their end-customers to activate software-based capabilities such as firewalls and encryption on top of existing Ethernet services in just minutes.
LRTV Custom TV
Symkloud NVF-Ready Video Transcoding, Big Data

7|9|14   |   3:41   |   (0) comments


Kontron and ISV partner Vantrix demonstrate high-performance video transcoding and data analytic solutions on same 2U standard platform that is ready for SDN and NFV deployments made by mobile, cable and cloud operators.
LRTV Huawei Video Resource Center
The Evolving Role of Hybrid Video for Competitive Success

7|4|14   |   4:09   |   (0) comments


At Huawei's Global Analysts Summit in Shenzhen, China, Steven C. Hawley from TV Strategies speaks to us about the evolving role of hybrid video for competitive success.
LRTV Huawei Video Resource Center
How CSPs Leverage Big Data in the Digital Economy

7|4|14   |   4:48   |   (2) comments


Justin van der Lande from Analysys Mason shares with us his views on how telecom operators can leverage customer asset monetization with big data. His discusses the current status of big data applications and the challenges and opportunities for telecom operators in the digital economy era.
LRTV Huawei Video Resource Center
Accelerator for Digital Business Future Oriented BSS

7|4|14   |   3:08   |   (0) comments


Mobile and internet are becoming intertwined; IT and CT are integrating; and leading CSPs have begun to transform to information service and entertainment providers. How should the BSS system evolve to enable this transformation? Karl Whitelock, an analyst at Frost & Sullivan, shares his views.
LRTV Huawei Video Resource Center
Orange Tunisia Discusses Multi-Band Antenna With EasyRET Solution

7|4|14   |   2:45   |   (0) comments


As new site acquisition becomes more difficult, Orange Tunisia has requested multi-band antenna to support UMTS and LTE innovation. Some things considered include reducing the cost of antenna maintenance and having high reliability antenna and EasyRET solution.
Upcoming Live Events!!
September 16, 2014, Santa Clara, CA
September 16, 2014, Santa Clara, CA
October 29, 2014, New York City
November 6, 2014, Santa Clara
November 11, 2014, Atlanta, GA
December 9-10, 2014, Reykjavik, Iceland
June 9-10, 2015, Chicago, IL
Infographics
Packet Design asks network professionals how they handle the cloud, SDN, and network management.
Today's Cartoon
Vacation Special Caption Competition Click Here
Latest Comment
Hot Topics
The Municipal Menace?
Jason Meyers, Senior Editor, Utility Communications/IoT, 7/22/2014
Cisco Puts a Fog Over IoT
Sarah Reedy, Senior Editor, 7/23/2014
Apple Earnings: Strong iPhone Sales, iPad Sales Slump, $7.8B Profit
Mitch Wagner, West Coast Bureau Chief, Light Reading, 7/22/2014
Salary Survey Report 2014
Sarah Reedy, Senior Editor, 7/23/2014
Facebook: 30% of Users Are Mobile-Only
Mitch Wagner, West Coast Bureau Chief, Light Reading, 7/24/2014
Like Us on Facebook
Twitter Feed