Verizon, Sprint Agree To Pay Combined $158 Million Over Cramming Charges 66
mpicpp sends news that Verizon has agreed to pay $90 million (PDF), and Sprint another $68 million (PDF), to settle claims that they placed unauthorized charges on their customers's bills. The process, known as "cramming," has already cost T-Mobile and AT&T settlements in the tens of millions as well. Most of the settlement money will go towards setting up refund programs, but Verizon and Sprint will be able to keep 30% and 35% of the fees they collected, respectively. In response to the news, both companies issued vague statements about "putting customers first." They are now banned from charging for premium text message services and must set up systems to ensure informed consent for third-party charges.
That'll Show 'Em (Score:5, Insightful)
No doubt these meager fines will deter such practices in the future...
Re:That'll Show 'Em (Score:5, Insightful)
Hey, that's not fair. They worked hard for that money, it's not like the people with the phones will miss it, now is it? They didn't work hard for it, otherwise they would have been running their own businesses, rather than working for someone else. What right has the government got to be involved in private business, anyway? (Insert other such stupidies as required.)
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Re: That'll Show 'Em (Score:2, Funny)
I've been doing that for years except with pennies!
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You know they'll just start finding CEO's that like it.
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I welcome our Goatse-inapired judicial overlords.
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Nickels are too small and smooth - Eisenhower dollar coins would be better,in uncirculated condition so that the reeding is nice and sharp.
Re:That'll Show 'Em (Score:5, Insightful)
Total revenue from cramming: $X
Total fees: $X * 0.65
Revenue after getting caught doing an illegal thing: $X * 0.35
With penalties like these, there's not even a risk/reward calculation. If you break the law and don't get caught, you're way ahead. But if you break the law and get caught, you're still ahead. There's literally no reason *not* to be evil.
Re:That'll Show 'Em (Score:5, Funny)
There's literally no reason *not* to be evil.
Well, there is the damage to their reputation
Just kidding!!!
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Even if it did, where are you going to go. Nice communications you've got there, it would be a shame...
In practically any market in the US, there are only ~2-5 players, all of them collude on prices and service.
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Well, this article's about Verizon & Sprint. Maybe you'll see me yelling about banks on a thread about banks.
Re:That'll Show 'Em (Score:5, Insightful)
So let me get this right,
If I rob a bank and take $100 Million dollars
a) There would be no prison time for the crime
b) I get to keep $35 Million for my efforts
So, if Corporates are people too, surely people can be corporates and treated "fairly" too
Re:That'll Show 'Em (Score:4, Insightful)
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The summary mentioned the premium text messages, these are messages that are sent by third parties and money from them goes to the third party, so it is more like a 150% fine, not 65% as some of the money from the premium text message went to the third party which doesn't have to refund the money.
Unfortunately, the third parties were never forced to advertise that requesting these messages caused the fees at all.
Re: That'll Show 'Em (Score:1)
All the better if we can apply this to politicians as well.
They should be scared.
triple damages is law IF guilty (Score:3)
Current law does allow for treble damages (triple) in a civil suit, IF the defendant intentionally engaged in wrongful behavior. So there could be a class action that could cost them much more the FCC settlement.
It should be noted that the amount in this story is how much they agreed to pay, without a trial. Had they fought it in court, they may have had to pay more, or it could be found that they actually didn't do anything illegal.
meaning if THESE companies guilty of THIS, NOW (Score:2)
Of course we all know that phone companies are bad in general. By "if they guilty" I mean if all of these specific companies were proven to have committed these specific acts, during the specific time period covered by the allegations. None of which was proven in court, so that's one reason the penalty was lower than it would have been if the government had to prove anything.
?!?! Over 90% make deals (Score:2)
> How many get to approach the bench and say...
> "Y'onour...I'm offering this much to make this all go away.
Over 90% of all criminal cases are settled. Trials are fairly rare in the US. FYI the companies didn't, and you don't, make the deal with the judge - you make a deal with the prosecutor or other entity bringing the complaint. Virtually ANY time you are charged with any crime the prosecutor will offer you a deal.
Btw, the deal the prosecutor offers you is an opening bid. You can and often
fyi Gov Rick Perry defunded her to force her to re (Score:2)
Fyi for anyone unfamiliar with the story, her term ends in 2016. Governor Rick Perry insisted that she resign. When she refused, he said he would veto funding for her office. So far that sounds like Perry was doing a good job, truing to get rid of a bad DA.
However, her office, the public accountability office, was ALSO investigating Perry. So she claims that he wanted to get rid of her because she was investigating him. She got him indicted for the threatening to veto her funding and otherwise tryin
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Damages 90M Percentage fees take from net profit = 0.9%
Less than one percent of one years profit for fucking customers for years. Yeah, that'll teach 'em.
As usual, this is a show and a sham. Bet some lawyers will make bank though.
Obviously (Score:4, Informative)
Of course it will deter them! Obviously, when you admit that you did wrong and accept responsibility for your misdeeds, the guilt and shame must be overwhelmingly embarrassing! Let's see how hard the hammer of the FCC came down this time...
This Consent Decree resolves allegations that Verizon charged consumers for third-party products...The Bureau...contends that Verizon violated the law...To resolve the Bureau’s investigation...Verizon will provide a total of $90,000,000 in payments and funds for consumer redress...the public interest would be served by adopting the Consent Decree and terminating the referenced investigation.
Hmm...I'm confused...[CTRL]-[F]..."Guilty"...No Results Found? ...
Serving the public interest my ass. Ninety million bucks says Tom Wheeler [wikipedia.org] goes to work for one of these companies the moment he leaves office.
So out of All of the major mobile carriers, (Score:2)
But, better than even money?
This will not encourage the creation of an honest cell phone provider that football stadiums are frequently named after.
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Cramming in a data plan (Score:3)
Does "cramming" include the carrier itself adding a data plan that the customer doesn't want? One of their competitors is known to do that [slashdot.org].
Thank God for Gov't Oversight (Score:3, Informative)
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Oh shut the !@#$ up... It's all the government's fault, so you say. Yes. Bad corporate behavior is enabled by government. And I'm sure that without government around, they wouldn't have done it? B. !@#$ing S.
You need to go back and look at history some more to see what companies got up to when there wasn't government insight. There's a nice little historical place in my home state, a canyon that held a mine. The workers in that mine were not paid very well, and they had to rent their barracks, and they
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Now, I'm pissed as anyone else that I'd get years in prison if I stole this much, and let's not mince words here.... The phone companies STOLE, and someone should be in prison. But don't go blaming this on the !@#$ing government. That's just your own little petty hatred.
You agree that they are COMMITING CRIMES -- yet you call me petty and hateful and to shut the fuck up when these CORPORATE PERSONS face no ciminal charges, pay a fine they can just as well pass on the customer and GET TO KEEP the ill got gains? Do you realize this is standard operating procedure in the US? That time and time again the Corporate Persons commit crimes that NET THEM HUNDREDS OF MILLIONS IF NOT BILLIONS IN PROFITS and pay only a Percentage in fines? It's clear you have missed the point that C
They get to keep some? (Score:5, Insightful)
Verizon and Sprint will be able to keep 30% and 35% of the fees they collected
WHAT THE FUCK? So pretty much they do something illegal, and only have to give part of the proceeds back?
Found the question mark:
1. Commit fraud
2. Get caught
3. Bribe^H^H^H Lobby politicians
4. PROFIT!
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Yeah. Most notably, that the summarizer didn't understand the original article.
The 30 - 35% refers to the amount of money that each company made from the premium text messages.
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Profit is profit... (Score:3)
...Verizon and Sprint will be able to keep 30% and 35% of the fees they collected, respectively.
Both companies do something illegal and still get to hold on to 30% or more of the money? They should be paying that 30 to 35 percent in excess to the customers they ripped off, court costs and fees, 100% of lawyer fees, plus a hefty fine. The victims should be getting 130% of their money back.
What kind of shit is this, DOJ? How in hell is this going to deter this type of behavior in the future? I'll tell you how - it's not. It will encourage it as just another revenue stream.
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Of course it gets better. They will use this fee to lower their income to reduce the taxes owed and they will just charge more for their plans to recoup the fees in the longer term. If you want to stop companies from doing this type of stuff then you have to hold the management and executives accountable. Get warrants, find out who authorizes these programs (though in cases like this where it's pretty much public knowledge you can go after the board for not stopping the practice at least), and at a minim
35% is not high enough! (Score:4, Interesting)
Some people above just realized there are actually living in a corporatocracy. The rest is smoke and mirrors.
Still waiting for my $250 refund from AT&T (Score:4, Interesting)
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Lawyers took it. :P
Hell Yeah (Score:1)
Where do I go to sigh up to commit a robbery, get caught, not go to jail, and keep 30% to 35% of the take.
Fines=payola (Score:1)
Are the individuals (Score:2)
ordering those kind of actions getting slapped in any way?
Criminal investigation, putting those crooks in court - anything like that?
No, company pays for it, and in end stockholders and customers.
And, not to forget who else gets a cut on those deals? Any idea, like lawyers, negotiators, what their compensations are on those with those numbers - all behind closed doors for good reasons... Sure, they don't have to deal with minimum or living wage issues.
Putting customers first (Score:2)
Damn It No! (Score:2)
Verizon has agreed to pay $90 million? (Score:1)