Posted 05/13/2015 at 11:28 AM
Posted 2 years ago
The final tally is in for the amount of damages that telecommunications giants Verizon and Sprint will pay out to resolve government complaints over their billing practices.
The Enforcement Bureau of the FCC made the announcement on Tuesday that both companies will pay a combined $158 million dollars. This sum covers payment to a redress program that will receive $130 million to dole out to customers in subscriber refunds, $10 million to state governments involved in the legal action and the remainder being fines handed down by the U.S. Treasury. Both companies were found liable for allowing their third-party companies to initiate ‘cramming’, the practice of tacking on unauthorized charges onto customers’ bills for suspicious subscriptions to services like celebrity gossip text news blasts. Verizon, Sprint and T-Mobile along with AT&T banned such practices last December; despite that, the Consumer Financial Protection Bureau did file a lawsuit against Sprint for cramming that same month.
The settlement also gives Verizon the dubious distinction of being the last of the big four telecommunication companies to be hit with lawsuits over cramming charges. AT&T was ordered to pay $105 million last fall over similar charges, and T-Mobile had to dole out close to $90 million. The FCC has made all of the documents detailing the settlement available to the public on their website.