Verizon, AT&T, T-Mobile & Others Ripping off Customers with Third Party Billing

Chances are you’ve seen commercials for a “joke of the day” text messaging services, premium downloadable ringtones and other premium -content services for your cell phone. Hidden in the fine-print is a monthly fee that isn’t ever mentioned in the commercial. You (or more likely someone else on your plan), text the message to the number they provide, and you get whatever “premium” content they had promised, and that’s that until you find a hefty $2.49 charge on your cell-phone for 30 seconds of music.

If it ended there, you could tell the person on your plan that signed up for the services to cut it out and be done with it. Unfortunately, many cell-phone users are finding unauthorized charges on their cell-phone service which purport to the premium content services, however, the customer never actually signed up for the service!

Why don’t cell-phone companies clean up this mess? It turns out they’re on the cut. Cell phone companies make huge commissions to do billing on behalf of third party services. These “premium content” service providers know that no one would ever write a check for what they’re offering, but if it’s hidden in a 5 page phone bill, someone might overlook them or not care enough to do anything about the charge. So the “premium content” service provider’s team up with the cell-phone companies and each make a hefty profit from these “premium content” services, since the data that you’re receiving costs fractions of a penny to transmit.

The major cell-phone carriers, AT&T, Verizon, Sprint, T-Mobile, and the like are only concerned about increasing the gross revenue of these premium content services. As the total dollar amount earned by these types of services increase, the major cell-phone companies get more revenue via commissions. If these companies were to crack down on premium content providers who claimed to be offering free services and then ended up charging the customers, they would lose out on a significant amount of revenue.

The State of Florida’s Cyber fraud Taskforce went after AT&T for charging customers for services which were purported to be free downloads back in 2005. The suit stated that 86,700 customers received bills for $3.95 each month for content they never agreed to pay for. As a result of the settlement, AT&T agreed to provide free calling cards to Floridians who were serving overseas in the military.  AT&T also agreed to provide over $1 million in credits to the customers that were wronged by the service!