Attorney General Laxalt announces $158 Million mobile cramming settlements with Sprint and Verizon

National Mobile Cramming Settlements now Total $353 Million

(The Office of the Attorney General) – Carson City – Nevada Attorney General Adam Paul Laxalt announced today that his Bureau of Consumer Protection, along with the attorneys general of 49 States and the District of Columbia, the Consumer Financial Protection Bureau and the Federal Communications Commission, reached settlements with Sprint Corporation (“Sprint”) and Cellco Partnership, doing business as Verizon Wireless (“Verizon”). The settlements include $158 million in payments, and resolve allegations that Sprint and Verizon placed charges for third-party services on consumers’ mobile telephone bills that were not authorized by the consumers, a practice known as “mobile cramming.”

Consumers who have been “crammed” are often unknowingly charged approximately $9.99 per month for “premium” text message or “PSMS” subscription services. These crammed subscriptions are for services such as horoscopes, trivia and sports scores.

“Mobile cramming is illegal, and consumers deserve to know for what they are being billed,” said Laxalt. “This settlement will enable those Nevadan’s affected to be refunded for unauthorized charges. As always, this office will continue to hold those accountable for exploiting consumers.”

Sprint and Verizon are the third and fourth mobile telephone providers to enter into a nationwide settlement to resolve allegations regarding cramming. The Attorney General’s Office announced similar settlements with AT&T last year. All four mobile carriers announced they would cease billing customers for commercial PSMS in the fall of 2013.

Under the terms of the settlements, Sprint and Verizon are required to provide $50 million and $70 million, respectively, to consumers who were victims of cramming. Sprint and Verizon will each distribute refunds to harmed consumers through redress programs under the supervision of the Consumer Financial Protection Bureau. Sprint will also pay $12 million to the attorneys general and $6 million to the Federal Communications Commission, while Verizon will pay $16 million to the attorneys general and $4 million to the Federal Communications Commission.

Consumers who believe they may have been affected by mobile cramming may submit claims to redress programs by visiting www.SprintRefundPSMS.com or www.CFPBSettlementVerizon.com. Consumers who have questions about the redress programs may call the settlement administrators at: (877) 389-8787 (Sprint) or (888) 726-7063 (Verizon).

The state of Nevada will receive $353,008.22 for its participation in the Sprint and Verizon settlements. The national mobile cramming settlements with the four mobile carriers will have netted the state a total of $833,624.00.

Senior Deputy Attorney General John McGlamery with the Bureau of Consumer Protection represented AG Laxalt in this matter.

To view details on the settlements, click here.