As part of a $105 million settlement with federal and state law enforcement officials, AT&T Mobility LLC will pay $80 million to the Federal Trade Commission (FTC) to provide refunds to consumers the company unlawfully billed for unauthorized third-party charges, a practice known as mobile cramming. The refunds are part of a multi-agency settlement that also includes $20 million in penalties and fees paid to 50 states and the District of Columbia, as well as a $5 million penalty to the Federal Communications Commission.
"We reached a broad settlement to resolve claims that some of our wireless customers were billed for charges from third-parties that the customers did not authorize. This settlement gives our customers who believe they were wrongfully billed for PSMS the ability to get a refund," an AT&T spokesman said.
In its complaint against AT&T, the FTC alleges that AT&T billed its customers for hundreds of millions of dollars in charges originated by other companies, usually in amounts of $9.99 per month, for subscriptions for ringtones and text messages containing love tips, horoscopes, and "fun facts." In its complaint, the FTC alleges that AT&T kept at least 35 percent of the charges it imposed on its customers.
Beginning today, consumers who believe they were charged by AT&T without their authorization can visit www.ftc.gov/att to submit a refund claim and find out more about the FTC’s refund program under the settlement.
This is the FTC’s seventh mobile cramming case since 2013, and its second against a mobile phone carrier this year. The FTC filed a complaint against T-Mobile in July, and that case is ongoing.