Verizon, Sprint to pay $158M over "cramming" cases

[steve2470]

http://www.cbsnews.com/news/verizon-sprint-to-pay-158m-to-settle-cramming-cases/

Verizon (VZ) and Sprint (S) agreed to pay a combined $158 million - including $120 million in refunds to consumers - to settle charges they allowed their customers to be illegally billed by third parties, the Consumer Financial Protection Bureau said on Tuesday.

The settlements, which are subject to final court approval, were announced in conjunction with the Federal Communications Commission and the state attorneys general. The wireless providers also agreed to pay $38 million in federal and state penalties, as well as agreeing to improve oversight of third-party billing.

"Sprint and Verizon had flawed billing systems that allowed merchants to add unauthorized charges to wireless customer bills," CFPB Director Richard Cordray said in a statement. "Today's actions will put $120 million back into the pockets of harmed consumers and require these companies to improve their billing practices going forward."

Most consumers were targeted online through ads that once clicked on, brought them to websites asking for their cellphone numbers. Some merchants tricked consumers into providing their numbers to get "free" digital content only to be charged for it, the bureau said. In other cases, merchants fabricated charges without delivering any goods or communication with consumers.