Sprint faces $105 million fine over fraudulent charges on customers' bills

[Himanshu Arora]

Sprint could be slapped with a hefty fine from the Federal Communications Commission for placing third-party charges on customers’ bills without their knowledge or authorization, a practice often referred to as cramming, according to a National Journal report.

According to an FCC official with knowledge on the matter, during the probe spanning a three-month window from August to October last year, the agency found that the carrier fraudulently billed customers for text message alerts, horoscopes, sports scores, ringtones, and many other unwanted services.

The Wall Street Journal is reporting that a majority of the FCC’s commissioners have indicated that they're going to vote in favor of the fine, which would be to the tune of $105 million, an amount that would tie for the largest the commission has ever imposed on a company -- back in October, the federal agency slapped AT&T with a $105 million fine for exactly the same practices.

Meanwhile, the Consumer Financial Protection Bureau (CFPB), which coordinated the investigation, is also mulling action against Sprint over the issue.

The news also comes just a few months after the Federal Trade Commission (FTC) filed a lawsuit against T-Mobile over cramming charges. The government agency also accused the magenta carrier of collecting a 35 to 40 per cent share, even after being made aware that these subscriptions were scams.

Not to be left behind was Verizon, which also recently agreed to pay $64 million to settle claims that the company overcharged some customers on their bills.

Permalink to story.

https://www.techspot.com/news/59183-sprint-faces-105-million-fine-over-fraudulent-charges.html

 

[Seventh Reign]

This explains like 97% of Comcast's billing.

 

[MilwaukeeMike]

Sprint should agree to pay the FCC 100% of their profits for two years instead of a flat dollar amount.

 

[Nobina]

Fine should be much bigger.

 

[Guest]

Why a fine? It is theft by deceiet . Put the ceo's in jail for ten years like any other criminal.

 

[Guest]

Shouldn't the consumers get refunded from the proceeds of the fine? Having Sprint use monies illegally collected to pay the FCC is nothing more than the affected consumers having paid money to the FCC. Something is wrong here.

 

[Guest]

That's what I was thinking, either it goes back to the affected customers, or the FTC is who benefits from fraudulent charges by applying the fine. Seems like a backwards incentive. I'm glad for the penalties, so that it is known and not accepted. But if it doesn't go to the customers who overpaid it is wrong.

 

[Nima304]

Shouldn't the consumers get refunded from the proceeds of the fine? Having Sprint use monies illegally collected to pay the FCC is nothing more than the affected consumers having paid money to the FCC. Something is wrong here.

I agree. Not only should they pay the fine and the people responsible possibly face jail time, but all affected customers should get a nice check in the mail for the exact amount they were overcharged. That's the definition of fair, the fact that customer refunds and theft hasn't even been mentioned is weird.

 

[Uncle Al]

Considering the complexity of distribution of fines and penalties back to the customers gets shot down by the courts, but if the court simply ordered them to provide free service to every injured customer for a year ... that would be easy, save them a ton of money on billing and force them to sit there day after day and watch the tally roll up on all the profits they loose!

 

[yRaz]

This explains like 97% of Comcast's billing.

Aside from the fact that comcast isn't a cellular carrier and has no way to commit fraud like this

 

[Skidmarksdeluxe]

The word 'cramming' has always meant stuffing or studying to me, they should change the term to 'stiffing' instead

 

[Guest]

Fining corporations and banks is not the answer, jail for the criminals behind it is! Why is it that these people are getting away with fraud but the man in the street cannot? It is this that needs investigating!! And just where does the money go exactly? Stinks of a racket perpetrated by the corporations, banks and politicians and it's time it stopped!!!

 

[hrowder]

I certainly agree that the consumer should somehow be recompensed. Just fining does not seem adequate.

As to jail time... I think illegal acts should be punished in the same way that you or I would be. Corporate executives who made the decisions to defraud should be at risk for prison the same way as us "peons" are. The whole faith in a "Nation of Law" as we are supposed to be is at risk by this and similar behaviors by corporations and politicians (let alone various law enforcement activities). Better to take suitable action now than risk the torches and pitchforks by the masses like we are currently seeing in Mexico.