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Washington - FTC: T-Mobile Raked In 'Hundreds Of Millions' From Bogus Charges

Published on: July 1, 2014 03:04 PM
By: AP
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FILE - This Sept. 12, 2012 file photo shows a man using a cellphone as he passes a T-Mobile store in New York. (AP Photo/Mark Lennihan, File)Washington - T-Mobile USA knowingly made hundreds of millions off its customers in bogus charges, a federal regulator alleged Tuesday in a complaint likely to damage the reputation of a household name in wireless communications.

In its complaint filed in federal court, the Federal Trade Commission claimed that T-Mobile billed consumers for subscriptions to premium text services such as $10-per-month horoscopes that were never authorized by the account holder. The FTC alleges that T-Mobile collected as much as 40 percent of the charges, even after being alerted by other customers that the subscriptions were scams.

“It’s wrong for a company like T-Mobile to profit from scams against its customers when there were clear warning signs the charges it was imposing were fraudulent,” said FTC Chair Edith Ramirez. “The FTC’s goal is to ensure that T-Mobile repays all its customers for these crammed charges.”

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The practice is often referred to as “cramming”: businesses stuff a customer’s bill with bogus charges associated with a third party. In this case, the FTC says T-Mobile should have realized that many of these premium text services were scams because of the high rate of customer complaints. But while as many as 40 percent of customers demanded refunds, others didn’t notice the charges.

Headquartered in Bellevue, Washington, T-Mobile USA, Inc., is a publicly traded company. According to its website, Deutsche Telekom AG maintains a 67 percent ownership in the company’s common stock.



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Read Comments (3)  —  Post Yours »

1

 Jul 01, 2014 at 03:47 PM OberBoberGrober Says:

I was always scammed by T-mobile. They always charge when my voicemail answers overseas which once came out to a couple hundred dollars. never will I touch this company. Their network SUCKS!

2

 Jul 01, 2014 at 08:43 PM Anonymous Says:

T mobile customers are supporting a German company which owns 67 percent!

3

 Jul 01, 2014 at 10:09 PM Mannish Tanna Says:

T-mobile's thievery is beyond reproach every bill is over inflated with phones charges. Never once month to month are their bills the same rife with fraud. Their shameful arrogance is pay or your service will be disconnected. If you cancel you will have to pay a $200.00 fee per service. These t-mobile Nazis are ruthless animals.

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