WASHINGTON (AP) — T-Mobile USA has drawn the attention of a second federal agency, and not in a good way.
The Federal Communications Commission is doing its own investigation into T-Mobile’s billing practices, which could result in fines if wrongdoing is found.
The FCC’s investigation follows a complaint the Federal Trade Commission filed today in federal court in Seattle, claiming that T-Mobile knowingly made hundreds of millions of dollars off its customers in potentially bogus charges.
The cellphone carrier reportedly billed consumers for subscriptions to premium text services such as $10-per-month horoscopes that were never authorized by the account holder. The FTC alleges that T-Mobile collected as much as 40 percent of the charges, even after being alerted by other customers that the subscriptions were scams.
The practice is known a cramming, because businesses stuff a customer’s bill with bogus charges associated with a third party. T-Mobile’s stock fell 10 cents to $33.52 in afternoon trading.