The Federal Communications Commission has ordered Sprint and Verizon to pay a combined $158 million to settle unauthorized charges to their respective customers’ monthly bills.
The settlement stems from complaints over a practice known as cramming in which wireless carriers would charge customers on average $10 to $15 per month for premium text messaging services they never signed up for.
Often times, the charges went unnoticed as many people simply don’t pay attention to their billing breakdown. Those who did spot the extra charges usually weren’t able to get the carriers to issue a refund. Worse yet, carriers would pocket 30 to 35 percent of the revenue generated from scam services like daily horoscopes and dating tips.
When asked to provide proof that customers had requested the services, the carriers came up empty-handed.
Sprint will be required to cough up $68 million while Verizon is on the hook for the lion’s share of the fine at $90 million. Most of the money – $120 million, to be exact – will be set aside for refunds to customers. $28 million will go to state governments while the remaining $10 million is deemed as a federal fine.
Sprint and Verizon aren’t the only two wireless providers that have been found guilty of cramming. Last year, AT&T agreed to pay $105 million to settle its dispute while disruptive carrier T-Mobile agreed to a $90 million fine.
Image via Pablo Martinez Monsivais, AP