The Federal Communications Commission’s Enforcement Bureau has reached a $90 million dollar settlement with Verizon Wireless, and a $69 million dollar settlement with Sprint Corporation (“Sprint”) to settle investigations that the companies billed customers millions of dollars for unauthorized third-party premium text messaging services – a practice called cramming. Under the terms of the agreements, Verizon’s $90 million settlement will include a minimum of $70 million to fund a consumer redress program, $16 million for state governments participating in the settlement, and $4 million as a fine paid to the U.S. Treasury. Sprint’s $68 million settlement will include a minimum of $50 million to fund a consumer redress program, $12 million for state governments participating in the settlement, and $6 million as a fine paid to the U.S. Treasury. The settlements also require the companies to implement consumer protections that include reforming internal processes and addressing how the companies interact with and disclose information to their customers. Last year, T-Mobile US, Inc., agreed to pay at least $90 million to settle cramming allegations, and AT&T, Inc., agreed to pay $105 million.
