|October 8, 2010
Media Contact: Jenn Meale
Phone: (850) 245-0150
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TALLAHASSEE, FL - Attorney General Bill McCollum today announced his office has reached an agreement with Sprint concerning unauthorized billing for third-party charges on consumers’ cell phone bills. Sprint has agreed to continue using a series of “best practices” standards previously established by the Attorney General which protects consumers from third-party “cramming,” including charges for “free” ringtones and other cell phone content customers either did not order or did not realize would result in a monthly charge.
Cell phone content includes ringtones, music, wallpaper, horoscopes and other material that is often promoted by online marketers as “free,” but ultimately ends up costing up to $19.99 a month. The charges appear on a subscriber’s monthly wireless bill and are usually recurring. The bill charges often appear under indiscernible names such as “OpenMarket,” “M-Qube” or “M-Blox.”
A large number of complaints related to the mobile content industry led to an investigation which revealed that thousands of Florida consumers had received these charges on their cell phone bills. Prior to the investigation, Sprint offered its customers the ability to block third-party mobile content and to implement parental controls free of charge. The investigation and subsequent settlement have been negotiated by the Attorney General’s CyberFraud Section of the Economic Crimes Division.
Sprint has agreed to continue using the standards previously established by the Attorney General for advertising on websites, prohibiting the use of the word “free” without clear disclosure of the actual price and requiring all content providers and advertisers to clearly and conspicuously disclose the true cost of cell phone content. These compliance standards, which include website design restrictions for online advertisers, will ensure consumers see and understand the terms and conditions of the purchase. Sprint will continue to enforce these standards through its contracts with all content providers and advertisers nationwide. Sprint will also continue its practice of issuing credits and refunds to consumers for unauthorized charges for third-party mobile content subscription purchases.
As part of the settlement, the company will pay a total of $800,000 to reimburse the state for the costs of its investigation and to help the Attorney General’s Office fund the efforts of the CyberFraud Section as it continues working toward similar reform across the industry. The agreement was negotiated with full cooperation from Sprint.
Sprint is the fourth and final wireless provider to adopt these standards and offer consumer refunds. T-Mobile reached an agreement in July 2010, Verizon Wireless reached an agreement in June 2009, and AT&T Mobility reached the first of these agreements in February 2008. The Attorney General’s efforts to end unauthorized billing for third-party charges on consumers’ cell phone bills has resulted in millions of dollars of restitution for consumers.