Hawaii, along with 49 other states and the District of Columbia, the Federal Trade Commission, and the Federal Communications Commission, have reached settlements with T-Mobile of $90 million in payments, and resolves allegations T-Mobile placed unauthorized charges for third-party services on consumers’ mobile telephone bills, a practice known as “mobile cramming.”
More than 61,000 T-Mobile customers in Hawaii are believed to have incurred unauthorized cramming charges.
The announcement was made Friday by the Dept. of Commerce and Consumer Affairs’ Office of Consumer Protection (OCP).
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 never heard of or requested. The states and federal regulators allege that cramming occurred when T-Mobile placed charges from third-parties on consumers’ mobile telephone bills without the consumer’s knowledge or consent.
“Anyone who believes that they may have been the victim of such deceptive practices should contact T-Mobile as soon as possible to see if they qualify for a refund.,” said OCP Executive Director Bruce B. Kim.
Under the terms of Friday’s settlements, T-Mobile must provide each victim of cramming who files a claim under its Premium SMS Refund Program an opportunity for a full refund. The settlement terms require that T-Mobile pay at least $90 million; of this sum, at least $67.5 million must be paid to consumers — a portion of which may be paid by forgiving debts consumers may owe T-Mobile.
Consumers can submit claims under the program by visiting http://www.t-mobilerefund.com. On that website, consumers can submit a claim, find information about refund eligibility and how to obtain a refund, and can request a free account summary that details PSMS purchases on their accounts.
Consumers who have questions about the program can visit the program website or call the refund administrator at (855) 382-6403.
T-Mobile will also pay $18 million to the states and $4.5 million to the FCC.
In addition to the refund program announced today, the OCP reports that Hawaii will receive over $203,000 for its participation in the settlement.
T-Mobile is the second mobile telephone provider to enter into a nationwide settlement to resolve allegations regarding cramming; OCP announced a similar, $105 million settlement with AT&T in October. T-Mobile and AT&T were among the four major mobile carriers — in addition to Verizon and Sprint — that announced they would cease billing customers for commercial PSMS in the fall of 2013.