FTC: AT&T To Pay $105M For Bogus Wireless Charges

WASHINGTON (AP) — A subsidiary of telecom giant AT&T will pay a hefty $105 million to settle government charges that the company unlawfully billed wireless customers for tens of millions of dollars in bogus charges — a practice known as cramming.

The multi-agency settlement involving AT&T Mobility LLC includes $80 million in customer refunds and $20 million in penalties and fees to 50 states and the District of Columbia.

In its complaint, the Federal Trade Commission said AT&T billed millions of customers for charges from third-party companies for services customers never asked to receive or were duped into subscribing to — things like horoscope texts or flirting tips. The fees, usually $9.99 a month, were not easy for customers to find on their bills.

A penalty of $5 million will be paid to the Federal Communications Commission.

In a statement, company spokesman Fletcher Cook said the settlement resolves "claims that some of our wireless customers were billed for charges from third-parties that the customers did not authorize."

He said AT&T last year discontinued third-party billing for premium short messaging services.

Copyright 2014 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.