FTC to Shut Down Mobile Cramming OperationThe Paralegal Resource
December 18, 2013 — 1,061 views
The Federal Trade Commission is to take action against mobile cramming. Mobile cramming refers to the process by which a number of telephone companies pitch different offers and services such as ‘Fun Facts’, and then add charges to the consumer without their permission. This has been affecting the public for a very long time now, and most mobile users have a positive outlook to the FTC’s recent action plan.
The plan is to recover the tens of millions of dollars of public money that has been generated by such scams. The mobile industry has thrived on this extra source of income. It has worked for a long time because most consumers disregard minor variations in the bill and allow them to go unnoticed. Many times, the services that have been charged without authorization come up as alphanumeric codes that consumers cannot interpret.
Deceiving Customers and Taking Advantage
Names and numbers like “77050IQ12CALL8663611606” are not caught by most mobile users, and they pay an additional $10 on their phone bills because of it. Now that this has become public, and people are becoming aware of the various ways in which seemingly small quantities are being scammed, users are being more careful and scrutinizing bills to check for discrepancies.
Telephone companies were successful in keeping this as a source of inflow of capital by making a tedious refund process. When consumers complained that they have been unjustly charged extra on their phone bills, company representatives would only put them through a time-consuming process that would demotivate people from reclaiming the amount. In some cases, companies have promised refunds during further months or bills that would come in time. However, these refunds were made only on rare occasions.
Companies Engaging in such Activity will be Penalized and Amounts Returned to Users
Often, authorization is also done through consumers themselves because of a lack of attention to the spam of such offer messages. Taking the normal tendency of people clicking the ‘OK’ button to get rid of advertisements, companies reframed ads so that ‘OK’ would instantaneously activate the services on the mobile devices.
The FTC is taking action and charging companies on fraud and deception to consumers. Organizations that have indulged in such activity have effectively violated the FTC Act, and will be penalized. The total additional amount that has been paid on bills is supposed to be returned to individual mobile users by the companies themselves.