T-Mobile to Refund Customers Millions for Billing for Unwanted Services

Advertisement
By Associated Press | Updated: 20 December 2014 11:47 IST

T-Mobile US will pay at least $90 million, mostly in refunds, for billing customers for cellphone text services they didn't order, under a settlement with federal regulators.

The Federal Trade Commission announced the agreement Friday with T-Mobile over billing for unauthorized charges, a practice known as "cramming." T-Mobile, the fourth-largest U.S. cellphone company, is paying at least $67.5 million in refunds to affected customers plus $18 million in fines to the 50 states and the District of Columbia, and $4.5 million in fines to the Federal Communications Commission.

Advertisement

The FTC sued T-Mobile in July, accusing it of billing customers for subscriptions to text services like $9.99-per-month horoscopes or celebrity gossip updates that they didn't want or authorize.

T-Mobile collected 35 percent to 40 percent of the charges, even after being alerted by customers that they were bogus, the FTC alleges.

Advertisement

Officials told reporters on a conference call that the $90 million was a floor, not a maximum, for the amount that T-Mobile could end up paying. "It could be well north of $100 million," said Bill Sorrell, the attorney general of Vermont.

A T-Mobile spokeswoman said the company had no immediate comment on the settlement. T-Mobile began a refund program in July and has said it has notified current and former customers. The company didn't provide an estimate of how much it has paid in refunds to date.

Advertisement

Many consumers aren't aware that third-party companies can put charges on their phone bills for text services, regulators say.

T-Mobile US Inc., based in Bellevue, Washington, is controlled by Germany's Deutsche Telekom AG. It's the No. 4 U.S. cellphone carrier after Verizon Wireless, AT&T and Sprint.

Advertisement

Under the settlement, T-Mobile must provide full refunds to all its customers affected by the "cramming," and the amount it pays in refunds and fines must reach at least $90 million. If the payout doesn't reach that amount, the difference between what T-Mobile pays and $90 million will go to the FTC for additional relief to consumers, consumer education or other uses.

T-Mobile also must contact all of its affected customers, both current and former, to tell them about the refund program and how they can make a claim. That must be done in a "clear and conspicuous way," the FTC said. Going forward, T-Mobile must get customers' explicit consent before putting third-party charges on their bills. The company must clearly indicate any third-party charges on the bills.

The settlement with T-Mobile came two days after another federal regulator, the Consumer Financial Protection Bureau, sued rival Sprint Corp. for alleged cellphone "cramming." The CFPB is seeking an unspecified money penalty against Sprint.

"Mobile cramming is an issue that has affected millions of American consumers, and I'm pleased that this settlement will put money back in the hands of affected T-Mobile customers," FTC Chair Edith Ramirez said in a statement. "Consumers should be able to trust that their mobile phone bills reflect the charges they authorized and nothing more."
 

Get your daily dose of tech news, reviews, and insights, in under 80 characters on Gadgets 360 Turbo. Connect with fellow tech lovers on our Forum. Follow us on X, Facebook, WhatsApp, Threads and Google News for instant updates. Catch all the action on our YouTube channel.

Further reading: T Mobile, Telecom, US
Advertisement

Related Stories

Popular Mobile Brands
  1. Xiaomi Pad 8 Price Increased: Here's How Much It Costs Now
  2. One UI 9 Testing Said to Be Underway for Samsung Galaxy S25 Series
  3. Sahara Meteorite May Be Fragment of a Lost Moon-Sized World, Study Suggests
  4. New OTT Releases This Week : Dhurandhar 2, Maa Behen, The Pyramid Scheme, and More
  5. OnePlus Turbo 6X, OnePlus Turbo 6X Pro Key Specifications Teased
  6. OnePlus 15, Nord 6, Pad 4 Receive Discounts During Community Sale 2026
  7. Tecno Pova 8 to Launch in India With 8,000mAh Battery on This Day
  8. Netflix Games Launches FIFA World Cup: Launch Edition Ahead of FIFA World Cup 2026
  1. Sahara Meteorite May Be Fragment of a Lost Moon-Sized World, Study Suggests
  2. OpenAI Introduces Smarter ChatGPT Memory, Adds Dreaming Architecture
  3. Tecno Pova 8 India Launch Date Announced; Battery Size, Design, Colour Options Teased
  4. Samsung Reportedly Starts Internal Testing of Android 17-Based One UI 9 for Galaxy S25 Series
  5. Bybit Lists Western Union’s USDPT Stablecoin for Trading and Transfers
  6. Xiaomi Pad 8 Price Hiked in India: Here’s How Much It Costs Now
  7. Instagram Reels Influencing Nearly Half of Purchase Decisions in India, Meta Study Claims
  8. OnePlus Turbo 6X, OnePlus Turbo 6X Pro Colour Options, Price Range, Key Specifications Teased
  9. Sattendru Maarudhu Vaanilai Now Streaming Online: Where to Watch Jai’s Romantic Thriller Movie
  10. Asics GEL-Kayano 33 Launched in India With New Stability Tech, FluidSupport System
Download Our Apps
Available in Hindi
© Copyright Red Pixels Ventures Limited 2026. All rights reserved.