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AT&T To Repay $80 Million In Shady Phone Bill Charges

Posted by samzenpus on from the pay-up dept.

First time accepted submitter dibdublin writes The Federal Trade Commission announced today that AT&T will pay $105 million for hiding extra charges in cellphone bills. The best part of the news? $80 million of it will go back into the pockets of people bilked by AT&T. The FTC announcement reads in part: "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 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."

38 of 61 comments (clear)

  1. Hah!!! by koan · · Score: 1

    This will go nicely with the check I got from the Apple suit.

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    1. Re:Hah!!! by binarylarry · · Score: 4, Funny

      calling the entire U2 back catalogue a "check" is a bit far fetched don't you think?

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    2. Re:Hah!!! by koan · · Score: 2

      i got a $250 check from a settlement against Apples scam, yes it cashed.

      --
      "If any question why we died, Tell them because our fathers lied."
  2. Re:AT&T by alvinrod · · Score: 5, Insightful

    Is there a more sleazy, incompetent corporate entity on the face of this planet?

    Comcast.

  3. Re: AT&T by Anonymous Coward · · Score: 1

    Disney

  4. Re:AT&T by bobbied · · Score: 1

    I was thinking GM myself....

    --
    "File to fit, pound to insert, paint to match" - Aircraft Maintenance 101
  5. Sounds like a win for AT&T by Joel+Cahoon · · Score: 1

    AT&T to Pay $105 Million Over Unlawful Billing

    ...customers who were billed “hundreds of millions of dollars" in unauthorized charges...

    I guess AT&T gets to keep the extra couple hundred million.

    1. Re: Sounds like a win for AT&T by Stoutlimb · · Score: 1

      Yes, they get to keep a big portion of ill gotten gains. What they pay will likely be a tax write off. Also, nobody goes to jail for outright fraud. There's nothing to see here, citizen. Move along.

    2. Re: Sounds like a win for AT&T by Anonymous Coward · · Score: 1

      I wouldn't fuckin bet on it. Criminals aren't stupid. And I don't see the government refunding any taxes they skimmed off this deal. We used to shoot redcoats for this kind of stuff. But that was when the right to keep and bear arms was seen as unecessarry rhetoric. Elon, PLEASE get those rockets ready. There are 10's of thousands of people willing to die on mars as free men rather than 'endevouring to persevere'.

    3. Re: Sounds like a win for AT&T by AK+Marc · · Score: 1

      Nope, I'd guess AT&T kept less than 50% of those 35%, as they were paid on to the actual crammers. This will be a spur for AT&T to start claiming against the actual crammers.

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    4. Re: Sounds like a win for AT&T by thieh · · Score: 1

      C'mon, the penal damage is like 25 million which is puny. The net profit of AT&T is like 18 Billion so it's like 8 hours of profit for them which is practically nothing. Unless you are telling me that's one million per customer, the penal part is BS.

  6. All well and good by MikeRT · · Score: 5, Insightful

    But at some point, an attorney general is going to have to have to call a spade and spade and actually file criminal charges against actual officials for the pattern that keeps emerging at the telecoms and cable companies. Notoriety for agreeing to pay $X for Y and then finding $X steadily increasing or Y getting padded is not an oversight. It's a pattern of fraud. People need to go to prison for that. The shareholders will thank the states after a few years if the states clean house in these companies and thus hopefully put an end to that rotten culture. It's a liability.

    1. Re:All well and good by tekrat · · Score: 4, Insightful

      You must be new here.

      Company officials *never* will see the inside of a cell. They won't even be charged. Instead, they will get a nice fat bonus, and the company will pay for that by charging higher rates and cutting 5000 workers who were never responsible, and making sub-standard wages.

      Some more palms will get greased in government, and things will continue Business As Usual. And we the public get the shaft.

      --
      If telephones are outlawed, then only outlaws will have telephones.
    2. Re:All well and good by Charliemopps · · Score: 4, Insightful

      But at some point, an attorney general is going to have to have to call a spade and spade and actually file criminal charges against actual officials for the pattern that keeps emerging at the telecoms and cable companies. Notoriety for agreeing to pay $X for Y and then finding $X steadily increasing or Y getting padded is not an oversight. It's a pattern of fraud. People need to go to prison for that. The shareholders will thank the states after a few years if the states clean house in these companies and thus hopefully put an end to that rotten culture. It's a liability.

      No... you don't understand how corporate cultures work. I have worked for several, including AT&T. They are designed for profit... and nothing else. So groups are created. Departments. Processes. You need to think of a company like AT&T like an ant-hill. There may be a queen and she may give a command like "Get me food!" but how that happens is completely outside her sphere of knowledge or even understanding. I'd even go so far as to say that in most corporate cultures Executives have very little to do with the direction of the company other than the people they hire.

      It's not like someone says "Hey! I bet we could do this illegal thing and make lots of money! They'll never catch us!" What happens is the collective actions of dozens of departments have a culture that is profitable. If it's not profitable, they get laid off, or broken up... eventually such systems develop in such a way that they make lots of money. Their upper management sees lots of green so all is well. The problem with this situation is that none of those people can see the forest from the trees. Collectively those departments are doing something illegal. But none of them, individually, think what they are doing illegal because they can't see the entire picture.

      The department that checks that the payments were authorized gets bonuses based on how much work they get done. So they authorize more. The billing department gets a cool trip because they got 98% on time payments. The printing department was congratulated for simplifying the bill resulting in fewer questions about bills. All, individually are totally legit. Together you have 1 department authorizing questionable content, another printing bills with missing information and a 3rd getting customers off the phone so fast they're practically hanging up on them. Combined, you have collusion to defraud, yet I guarantee you that if you asked any one of those people they'd tell you they had no idea what was going on.

      And trust me, even if you did suspect something, going into a meeting and suggesting that your companies hugely successful, hugely profitable lead project is a terrible idea. Even if you're correct and save the company from legal action, you'll be looked at like that guy at the party that said "Maybe we shouldn't drink so much..." good idea, yes... popularity winner? NO

    3. Re:All well and good by sjames · · Score: 1

      They COULD put them away. They actively chose not to.

    4. Re:All well and good by PJ6 · · Score: 1

      I don't think that's a good argument that nobody can be required to take responsibility.

      By law, C-level execs are required to 'sign off' on a lot of important things, which puts them on the hook for X (regardless of claims of ignorance) because it is a statement that they have checked, with due diligence, the legality of X.

      It would be relatively straightforward to add to that list a little.

      For best effect, there should be a rider that wrongdoing past a certain scale automatically gets all compensation paid to the exec, to date, doubly seized - seized from the exec (spent or not), and seized from the business.

  7. $80M funnelled through the government = $0.79 net by WoodstockJeff · · Score: 1

    By the time the bureaucrats finish, less than $1 will be available to split amongst all us wronged consumers.

  8. Re:AT&T by TWX · · Score: 1

    Comcast didn't fail to disclose a known bug with a product of theirs that has killed numerous people and continues to kill as it remains unpatched though.

    --
    Do not look into laser with remaining eye.
  9. This just happened to me by apraetor · · Score: 4, Informative

    My bill showed my data and voice plans each as $20 more than the agreed-upon (in writing) rates selected back in January of this year. I had to argue on the phone for about half an hour, but they finally agreed to refund the money. I had to stay on the line while the CS rep filed a separate refund form for not only each month this happened, but for each of the charges. Since it was 9 months of wrongful billing it took an hour for her to refund me the 18 charges -- $360. In less than a year. I've been telling everyone I know who uses AT&T to double-check their bills because of this. Something similar happened to me with an insurance company which over-billed me by $600; by the time I got the money back it was $850 including the interest.

    1. Re:This just happened to me by Tokolosh · · Score: 5, Insightful

      I was about to jump ship to Uverse, but insisted on a bottom-line price before signing. They claimed it was impossible to provide, because of local taxes, yada yada. Well then, how are you able to bill me once I sign? No thanks, scumbags.

      --
      Prove anything by multiplying Huge Number times Tiny Number
    2. Re:This just happened to me by wiredlogic · · Score: 2

      Why do you continue to give them your business?

      --
      I am becoming gerund, destroyer of verbs.
    3. Re:This just happened to me by apraetor · · Score: 1

      I've got to finish paying off my phone, I had switched to AT&T Next so once that contract is up I'm probably going pre-paid. I use Google Voice for my main number anyway, so I can bounce between carriers once I get my phone *crossed fingers* unlocked.

  10. Jail time for corporate officers by oldhack · · Score: 3, Insightful

    Send them to fed for couple months at least. The fine is not even a slap on the wrist. What's the point?

    --
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    1. Re:Jail time for corporate officers by DaMattster · · Score: 2

      +1, The fact that the officers practically get away scot-free is galling.

  11. And no one is going to prison? by cjonslashdot · · Score: 3, Informative

    That's why these companies just keep on doing this.

  12. Maybe this will encourage you by Tokolosh · · Score: 1

    to renew your flagging zeal to cooperate with the NSA.

    --
    Prove anything by multiplying Huge Number times Tiny Number
  13. Feeling Buttered Up... by Austerity+Empowers · · Score: 1

    I feel like the FCC is trying to butter us up (or perhaps lube our rear ends) for something unpleasant they plan to do.

  14. Re:AT&T by AK+Marc · · Score: 1

    Ford (Pinto), Chrysler (minivan latches), or GM? Comcast and AT&T didn't actually kill anyone. The car companies did.

    --
    Learn to love Alaska
  15. And how will they repay it by grilled-cheese · · Score: 2

    I bet everyone gets a 2 month subscription to some junk AT&T service like being able to track your family's phones through their proprietary app.

  16. Re:AT&T by Anonymous Coward · · Score: 1

    You spelled Verizon wrong.

  17. Re:AT&T by Charliemopps · · Score: 1

    Is there a more sleazy, incompetent corporate entity on the face of this planet?

    Comcast.

    Oracle beats them all, hands down.

  18. Doesn't change a thing. by fhage · · Score: 1
    Anyone can add a $9.99/mo charge to your bill. All they need is your cell # and access to a ring tone web site. You'll get a long spam SMS that ends; "reply STOP to cancel the special offer". If you fail to respond properly to the mystery SMS you didn't request, the phone company will bill you, claim you authorized the charges and refuse to cancel the service or issue any refunds. One has to put a block on all 3rd party services to in order to avoid being subject to this.

    When it happened to me and I complained, the ATT CSR told me that it was Congress's fault; they specifically wrote this feature into Telecom law to encourage business.

    1. Re:Doesn't change a thing. by seebs · · Score: 1

      I got refunds from AT&T for these, and they let me set a thing on my account to prevent them.

      Never had it happen with any provider but AT&T.

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    2. Re:Doesn't change a thing. by ruir · · Score: 1

      Are you not mixing up things? Back in here, they sent me a code if someone does that, *and* if I reply with the code, it is like signing a contract. Actually the most dangerous part it, is your teens doing it with their mobiles. Those services I have seen charge you between 2 to 4 euros per week, and they do not bilk you more, because they hope you are illiterate enough not to notice. I have even seen spammy sites like "open your mobile with a code from this site" which were exactly the same thing.

  19. "Insurance" charges = Scam #2 by Tablizer · · Score: 1

    AT&T keeps adding "insurance" charges to our bill, and make up silly excuses for adding it, usually involving some twisted "misunderstanding" of our requests. Do their sales people go to Bogus Alibi School?

    Me: "Achoo!"

    AT&T Service Dweeb: "Achoo is Swahili for 'I want insurance'. Done, Bye [phone click]"

    --
    Table-ized A.I.
  20. Re:AT&T by sjames · · Score: 1

    The banks laundering money for terrorists comes to mind.

  21. Re:AT&T by ruir · · Score: 1

    Microsoft, do you even need to ask it?

  22. Didn't they make billions doing this? by rsilvergun · · Score: 1

    I seem to remember the profits being a _lot_ more that a measly $105 billion.

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