July 2, 2014
T-Mobile Accused Of “Cramming” Deceptive Charges Onto Customers
The LA Times describes it as “cramming: putting unauthorized, misleading or deceptive charges on phone bills.” In fact, the accusations by the Federal Trade Commission are the first of their kind against a phone company, and it is a big one at that. T-Mobile presents itself as defenders of its customers, but is now alleged to have been involved in taking fees in full knowledge of fraud by third parties.
The third parties concerned are premium sites such as flirting sites, trivia facts by text, celebrity gossip and the like. Usually the charges are for around $9.99 a month, although as consumeraffairs.com points out, they are not exactly easy to spot on a bill, sometimes appearing 123 pages into the bill and not always displaying the name of the third party site is involved. Almost half of the fee is taken by T-Mobile, explaining why they may not be too keen to let their customers know about these charges, even when the volume of queries about questionable charges on their bill must surely have been enough to alert T-Mobile to the problem.
Usually, if somebody is willing to sign up to such premium services, they should be asked to click at least twice to agree to be charged, making them aware of the future outlay. Instead, they have in many cases unwittingly sign up simply by clicking on an ad. It is unsurprising that there are some businesses on the Internet that try to leach money from people through deception. I doubt many people would be talking about this subject, and that it would be trending as it is, if the story was simply “it turns out an obscure flirting service is a bit dishonest and untransparent in the way it gets money from its customers.” What is surprising is that a supposedly reputable company such as T-Mobile could be aware of the practice with itself as a facilitator, and allow it to continue simply to take its own considerable fee.
For some reason, certain large companies seem to acquire our faith in them. Perhaps through widespread advertising and careful marketing, or simply by being so large, we come to believe that they are a sort of national treasure; an old friend who is always there for us. But why would they be, really? That is not to say that all companies are out to directly defraud us, but our trust in them must be to an extent misjudged, in most cases. Anyone who charges us something .99 cents for a product, which is most of them, is giving us a clear sign that they are in fact not our dear old pals but instead doing everything they can to extract money, even by deceit.
Of course, a major difference in the T-Mobile case is that the deceit is illegal. This is why a suit is being brought by the FTC. There is also the fact that T-Mobile has been making a big thing of protecting its customers recently, and it is only recently that I saw a representative talking about being proud of leading the charge against huge, unfair charges for using phones abroad.
According to USA Today, T-Mobile CEO John Legere called the FTC’s complaint “unfounded and without merit. In fact, T-Mobile stopped billing for these Premium SMS services last year and launched a proactive program to provide full refunds for any customer that feels that they were charged for something they did not want.” But the problem is that T-Mobile should at least have been more vigilant much sooner, and at worst, which seems highly possible now, should have put an end to the problem of cramming when they became aware of it, not when it became impossible to advantageously ignore it any longer.
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