News Release: Major Mobile Carriers to Stop Billing Problematic Third-Party Charges

Posted on Nov 22, 2013 in News Releases

 

DEPARTMENT OF COMMERCE AND CONSUMER AFFAIRS

Office of Consumer Protection

 

NEIL ABERCROMBIE
GOVERNOR

KEALII S. LOPEZ
DIRECTOR

 

FOR IMMEDIATE RELEASE

Nov. 22, 2013

 

Major Mobile Carriers to Stop Billing Problematic Third-Party Charges

 

 

HONOLULU — The Department of Commerce and Consumer Affairs’ Office of Consumer Protection (OCP) announced a major breakthrough in the fight against mobile cramming– unauthorized third-party charges that appear on mobile telephone bills.

 

Bruce B. Kim, the executive director of the Office of Consumer Protection, said today that three of the nation’s largest mobile phone carriers — AT&T Mobility, Sprint and T-Mobile — will no longer charge their customers for commercial Premium Short Messaging Services, also known as “PSMS,” or “premium text messages.” PSMS accounts for the majority of third-party charges on cell phones and for the overwhelming majority of cramming complaints.

 

“This is a victory for mobile phone users in Hawaii and across the nation,” said Kim. “While PSMS has some benefits, like charitable giving, it is also a major contributor to the current mobile cramming problem. The Office of Consumer Protection is very pleased that AT&T, Sprint and T-Mobile have decided to stop the flow of money from the pockets of ordinary people to the bank accounts of scam artists. We’re hopeful the other carriers will soon follow their lead. There is still much work to be done.”

 

Consumers can guard against mobile cramming with these helpful tips:

  1. Check your monthly wireless phone charges thoroughly and note service you have not ordered or calls you have not made.
  2. If you pay a flat rate and it goes up even by a few dollars, take a closer look.
  3. There is no one type of cramming charge. Keep an eye out for generic-sounding services and fees like “Minimum Use Fee,” “Voice Mail” or “Member Fee.”

 

OCP will continue to work with other states for industry reforms and to recover money for Hawaii consumers victimized by cramming. Cramming on mobile phones and land lines is estimated to cost American subscribers $2 billion per year.

 

In May, Vermont Attorney General William Sorrell released a survey showing that 60 percent of third-party charges placed on the mobile phone bills of residents in the area were unauthorized, or “crammed.”

 

Hawaii, along with 44 other states have been engaged in discussions to stop mobile cramming.  The discussions have been led by Vermont, Delaware, Florida, Maryland, Oregon, Texas and Washington.

 

AT&T, Sprint, and T-Mobile are the second, third and fourth largest providers of mobile telephone services nationwide. Two carriers have confirmed they will continue to allow charitable donations to be billed via PSMS.

 

The Office of Consumer Protection is the primary Hawaii state agency responsible for reviewing, investigating and prosecuting allegations of unfair or deceptive trade practices in consumer transactions. 

 

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Media Contact:

Brent Suyama

DCCA Communications Officer

808-586-7582

bsuyama@dcca.hawaii.gov

cca.hawaii.gov