Senate examines ‘cramming’

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by KMOV.com staff

KMOV.com

Posted on July 31, 2014 at 9:34 AM

(KMOV) – The Federal Trade Commission is suing T-Mobile for ignoring warning signs some third-party charges were fraudulent.

Investigators say the three major wireless carriers allowed those charges to add up on bills in a practice known as 'cramming'.

The Wall Street Journal reports many of the 'cramming' charges are for ringtones or premium services that send users gossip, horoscopes or other updates via text message.  The charges were typically $10 a month and buried on a consumer’s phone bill or with obscure labeling.

Wireless companies are accused of keeping 30 to 40 percent of the charges.

Federal Trade Commission and Federal Communications Commission officials say they have penalized companies for cramming over the years and more lawsuits could follow.

The wireless carriers responded by pointing to their recent efforts to discontinue most third-party billing services. 

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