The settlement resolves allegations that AT&T Mobility placed charges for third-party services on consumers’ mobile phone bills that had not been authorized by the consumer, a practice known as “mobile cramming.” AT&T Mobility has agreed to pay $20 million to the attorneys general and $5 million to the FCC. Kentucky is receiving $283,420.96 for its participation in the settlement.
“No one likes to pay for something they didn’t authorize,” Attorney General Conway said. “This settlement will help stop cramming on Kentuckians’ cell phone bills and return money to those who paid for charges that they neither requested nor used. I encourage Kentucky consumers who have been affected by mobile cramming through AT&T Mobility to submit a claim through the Federal Trade Commission’s restitution program.”
Consumers who have been “crammed” often complain about charges – typically $9.99 per month – for “premium” text message subscription services (also known as PSMS subscriptions) such as horoscopes, trivia and sports scores that the consumers have never heard of or requested. The attorneys general and federal regulators allege that cramming occurred when AT&T Mobility placed charges on consumers’ mobile phone bills for these services without their knowledge or consent.
AT&T Mobility is the first mobile phone provider to enter into a national settlement to resolve allegations regarding cramming. AT&T Mobility was among the four major mobile carriers—in addition to Verizon, Sprint and T-Mobile—that announced it would cease billing their customers for commercial PSMS last fall.
Eligible consumers can seek restitution
Under the terms of the settlement, AT&T Mobility is required to provide $80 million to pay refunds to cramming victims. Beginning today, consumers can submit claims under the AT&T Mobility cramming refund program by visiting www.ftc.gov/att. If consumers are unsure about whether they are eligible for a refund, they can visit the claims website or call the claims administrator at (877) 819-9692.
The settlement requires AT&T to stay out of the commercial PSMS business – the platform that law enforcement agencies attribute a large share of the mobile cramming problem. Additional terms of the agreement require AT&T Mobility to take steps designed to ensure that it only bills consumers for third-party charges that have been authorized
