FTC recommends 5 steps to help prevent carriers from over-charging

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The Federal Trade Commission caused something of a stir when it published its allegations against T-Mobile for the use of “cramming” not so long ago. It claimed that T-Mo was knowingly charging its customers “millions” in “bogus charges”, a claim which John Legere claimed was “sensationalized” and completely unfounded.

As a follow up to that event, the FTC has published a list of five recommendations for carriers and merchants to follow to help avoid unauthorized charges. The steps include the following:

  1. Giving consumers the right to block 3rd party charges.
  2. Making sure that any advertising or marketing or opt-in processes are not deceptive.
  3. Getting consent from the consumer before charging them.
  4. Clearly showing charges on the customers’ bills.
  5. Providing an effective process for dispute resolution.

Of course, much like the allegation, this is coming all too late for T-Mobile. The company announced last November that it would no longer be dealing with premium SMS companies, and would start refunding any customers who had been over-charged. It started a new program earlier this year to proactively find customers who had been charged, and stated that it would be “doubling down” on those efforts this summer.

There was another purpose to the list though. As noted by Jessica Rich, director of the FTC’s Bureau of Consumer Protection: “mobile payments continue to be on the rise we expect more and more cramming to occur unless companies take preventive measures.” In that case, some of the guidelines help to bring mobile billing more in line with policies used by credit card companies. The fifth point, for instance, would bring an easier method for customers to dispute unauthorized charges, in the same way you would if you spotted erroneous charges on your credit card bill.

We shouldn’t complain about any of this as consumers. We may feel a little defensive on T-Mobile’s behalf at times, but if the FTC’s guidelines bring a better mobile payment culture to market, it can only benefit us as consumers.

Source: FTC
Via: NYT

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  • Verizonthunder

    It’s a hot topic that is finally getting attention. This is directed not just at T-Mobile but all carrier’s across the board. Transparency is a must for consumers.

  • gadget_hero

    I think its interesting that the only carrier actively trying to get ride of cramming is the very carrier that the FTC chose to investigate as T-Mobile a YEAR before the probe began actively refunding the fees and has made it policy to stop the use of said fees.

  • Look up the Washington Monument syndrome to understand what the FTC is doing. Then, move along, there’s nothing to see here but for some bureaucrats trying to be a little less irrelevant.

  • S. Ali

    What I don’t get is how “3rd Party” charges are somehow worse than the overages Sprint/ATT/VZW charge on their data plans that many consumers probably don’t even know. If the FTC wants to lay down rules about 3rd parties, what about 1st party charges??

    Why don’t those carriers offer a way to disable overages?

  • ChitChatCat

    T-Mobile has had the ability to block third party charges for years. I have it on all my lines.

  • Startswithaj

    It’s a shame all the bad apples had to ruin it for the ones who liked the approved third party billing. I rather liked not having yet another monthly charge on my credit card for my Spotify account since it was added onto my T-Mobile bill.