FCC Plans Massive Fine of Sprint for Bogus Charges

The cell-phone company billed customers for services they never asked for, according to an investigation by federal regulators.

Shutterstock.com
Brendan Sasso
Add to Briefcase
See more stories about...
Brendan Sasso
Dec. 15, 2014, 12:43 p.m.

The Fed­er­al Com­mu­nic­a­tions Com­mis­sion is pre­par­ing to fine Sprint $105 mil­lion for over­char­ging its cus­tom­ers, ac­cord­ing to agency of­fi­cials.

The fine would be tied for the largest the FCC has ever im­posed on a com­pany. In Oc­to­ber, AT&T agreed to pay $105 mil­lion over sim­il­ar al­leg­a­tions.

Ac­cord­ing to the en­force­ment ac­tion, which hasn’t been fi­nal­ized, Sprint billed cus­tom­ers for third-party ser­vices it knew they hadn’t asked for and didn’t want. All five FCC com­mis­sion­ers are re­view­ing the pro­posed fine, but they haven’t voted to take ac­tion yet, the agency of­fi­cials said. It’s un­clear wheth­er Sprint and the FCC are still en­gaged in set­tle­ment talks.

Neil Grace, a spokes­man for FCC Chair­man Tom Wheel­er, de­clined to com­ment. A Sprint spokes­man said the com­pany doesn’t “com­ment on ru­mors and spec­u­la­tion.”

The Con­sumer Fin­an­cial Pro­tec­tion Bur­eau is also mulling ac­tion against Sprint over the is­sue, ac­cord­ing to the FCC of­fi­cials. A CFPB spokes­man de­clined to com­ment.

In re­cent years, mem­bers of Con­gress and fed­er­al reg­u­lat­ors have been try­ing to com­bat “cram­ming” — the prac­tice of pla­cing un­wanted charges on phone bills. The Fed­er­al Trade Com­mis­sion has brought nu­mer­ous cases against third-party scam­mers, but reg­u­lat­ors are only just be­gin­ning to go after the phone com­pan­ies them­selves.

Earli­er this year, the Sen­ate Com­merce Com­mit­tee re­leased a re­port find­ing that third-party charges on cell-phone bills have be­come a bil­lion-dol­lar in­dustry, much of it fraud­u­lent. The ma­jor car­ri­ers all keep a por­tion of the rev­en­ue for them­selves, ac­cord­ing to the Sen­ate re­port.

Those third-party ser­vices are of­ten “premi­um” text mes­sages like horo­scopes or celebrity gos­sip. Con­sumers of­ten don’t real­ize they’re be­ing billed for the spam be­cause the charges are bur­ied on their monthly bills un­der mis­lead­ing titles, ac­cord­ing to the Sen­ate in­vest­ig­a­tion.

What We're Following See More »
CEOS HAVE BEEN FLEEING FOR THE EXITS
Trump to End Business Councils
14 hours ago
THE LATEST
FROM STATEMENT
McConnell: “No Good Neo-Nazis”
17 hours ago
THE LATEST
NO FORMAL LEGISLATIVE EFFORT
CBC Members Call for Removal of Confederate Statues from Capitol
18 hours ago
THE LATEST

"Members of the Congressional Black Caucus are reviving calls to remove Confederate statues from the Capitol following the violence at a white nationalist rally in Virginia." Rep. Cedric Richmond, the group's chair, told ABC News that "we will never solve America's race problem if we continue to honor traitors who fought against the United States." And Mississippi Rep. Bennie Thompson said, “Confederate memorabilia have no place in this country and especially not in the United States Capitol." But a CBC spokesperson said no formal legislative effort is afoot.

Source:
IN THE MIDDLE OF THE NIGHT
Baltimore Removes Confederate Monuments
19 hours ago
THE LATEST

"Confederate statues in Baltimore were removed from their bases overnight, as crews using heavy machinery loaded them onto flat bed trucks and hauled them away, an end to more than a year of indecision surrounding what to do with the memorials. The action comes after Baltimore City Council approved a plan Monday night to remove four statues linked to the Confederacy from public spaces in the city."

Source:
“TOLERATES BIGOTRY”
AFL-CIO Head Trumka Quits Council
1 days ago
THE LATEST
×
×

Welcome to National Journal!

You are currently accessing National Journal from IP access. Please login to access this feature. If you have any questions, please contact your Dedicated Advisor.

Login