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
From The Founder
It's clear to me that the communications industry is divided into two types of people, and only one is living in the real world.
LRTV Documentaries
Paul Bunyan's Giant Gigabit Plans

12|22|14   |   03:26   |   (0) comments


Gary Johnson, the CEO and GM of Minnesota rural operator Paul Bunyan Communications, discusses the company's 5,000-square-mile gigabit network rollout.
LRTV Interviews
CenturyLink: Building the Case for NFV

12|19|14   |   02:14   |   (0) comments


At the 2020 Vision Executive Summit, James Feger, VP, Network Strategy & Development at CenturyLink, talks about how the US operator is approaching virtual network functions from an operational and business case perspective.
LRTV Interviews
Liberty Global Sees Business Goldmine

12|18|14   |     |   (0) comments


Steen Sorensen, VP of business services for Liberty Global, explains where the giant international MSO sees growth potential.
LRTV Documentaries
EE: The Road to 5G

12|16|14   |   16:02   |   (1) comment


Andy Sutton, the principal network architect at UK mobile operator EE, explains how his company is using Wembley stadium as a wireless test bed and how that's helping EE to plan the evolution to 5G.
LRTV Huawei Video Resource Center
Highlights of Huawei's NFV Open Cloud Forum 2014

12|16|14   |     |   (0) comments


Huawei hosted its inaugural NFV Open Cloud Forum during the SDN & OpenFlow World Congress 2014 in Düsseldorf, Germany. The Forum brought together technology thought leaders, senior executives and telecom professionals from global carriers, industry associations, as well as other partner companies in the ecosystem, to exchange views on and collectively explore how ...
LRTV Custom TV
Realizing Operators' Digital Vision

12|16|14   |   5:23   |   (0) comments


Leveraging technology is fundamental to digital transformation but understanding customers and serving them really well is at the heart of digital businesses. TM Forum lists the following as the strategic pillars of the digital business: business agility and rapid innovation, operational agility and effectiveness, IT and data centricity, plus customer centricity. ...
LRTV Documentaries
US Cellular Injects Analytics Into LTE

12|16|14   |   2:57   |   (1) comment


US Cellular's Mario Vela explains how the operator uses analytics for network planning and what comes next as the carrier looks to eke more value out of its metrics.
LRTV Interviews
How Cox Biz Plans to Keep Growing

12|15|14   |     |   (2) comments


Steve Rowley, SVP of Cox Business, details how the third-biggest US MSO intends to boost its revenues to $2 billion and beyond over the rest of the decade
LRTV Huawei Video Resource Center
Interview With Bill Zhang, Director of SoftCOM Product Management, Huawei

12|15|14   |   2:50   |   (0) comments


Bill Zhang elaborated on Huawei's open philosophy in NFV solution development and network architecture design at the SDN & OpenFlow World Congress 2014.
LRTV Huawei Video Resource Center
Event Highlights: Huawei at SDN & OpenFlow World Congress 2014

12|15|14   |   3:43   |   (0) comments


Huawei joined the 2014 SDN & OpenFlow Congress as one of the key sponsors and contributors. At the event, Huawei reinforced the openness and flexibility of its network infrastructure strategies, and provided updates on its SDN and NVF innovations. Through participations at the exhibitions, forums and speeches, Huawei encouraged the industry to "think bigger and ...
LRTV Interviews
How Cable Biz Services Hit $10B Mark

12|12|14   |     |   (1) comment


Cable operators reached $10 billion in annual business services revenues by delving deeper into their vertical markets and expanding beyond the smallest firms.
LRTV Documentaries
Mediacom Aims to Test Connected Tractors

12|11|14   |   05:07   |   (3) comments


Cable business service provider is taking its services to the 'agribusiness' sector in partnership with farm equipment specialist John Deere and is getting involved in Gigabit Cities developments.
Upcoming Live Events
February 10, 2015, The Westin Peachtree Plaza, Atlanta, GA
March 17, 2015, The Cable Center, Denver, CO
April 14, 2015, The Westin Times Square, New York City, NY
May 6, 2015, McCormick Convention Center, Chicago, IL
May 13-14, 2015, The Westin Peachtree, Atlanta, GA
June 9-10, 2015, Chicago, IL
Hot Topics
T-Mobile, BlackBerry Flirt With Reuniting
Sarah Reedy, Senior Editor, 12/17/2014
1-Gig: Coming to a Small Town Near You
Jason Meyers, Senior Editor, Gigabit Cities/IoT, 12/17/2014
Comcast Launches 4K Streaming Service
Alan Breznick, Cable/Video Practice Leader, 12/18/2014
US Carriers, You're Going to Cuba!
Mitch Wagner, West Coast Bureau Chief, Light Reading, 12/18/2014
T-Mobile Lights Up 27 Wideband LTE Cities
Sarah Reedy, Senior Editor, 12/15/2014
Like Us on Facebook
Twitter Feed
Webinar Archive