What Verizon, Sprint Cramming Settlement With FCC Means for Customers
Both companies have set aside money for customer redress.
— -- Some Verizon and Sprint customers will eligible for refunds after both companies agreed to a combined $158 million settlement with the Federal Communications Commission over claims they allowed bogus charges on customers' monthly bills.
Verizon will pay $90 million and Sprint $68 million over claims they tacked on charges from third-party premium text message services onto customers' bills.
The practice, known as cramming, involves third-party text messaging services that sell information such as horoscopes and trivia. The FCC claims some customers were charged for the texts despite never signing up for the services.
Both companies said they stopped allowing the third-party text services before federal regulators launched their investigation and reiterated their focus on putting their customers first.
Of Verizon's $90 million settlement, at least $70 million will go toward a program to refund customers who were hit by bogus charges. The company has set up a website for customers to get more information.
"Verizon thoroughly vetted the companies that provided these services and terminated providers who did not comply with our industry-leading practices," company spokeswoman Debra Lewis said in a statement.
Sprint's settlement includes $50 million allocated for affected customers.
"This settlement gives our customers who believe they were wrongfully billed for (premium text messaging) services the ability to get a refund, and allows Sprint to continue to focus on enhancing the customer experience," Jeffrey Silva, a Sprint spokesman, said in a statement.
According to the FCC, the most common cramming charge is $9.99. Regulators recommend looking out for generic sounding fees. Some common words that may be used include: Min. Use Fee, Activation, Member Fee or Subscription.
Some carriers offer a feature that will block third-party services on your phone bill, giving consumers another way to protect themselves.
The Associated Press contributed to this report.
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