T-Mobile must refund $90M to customers

Current and former T-Mobile (TMUS) customers who were hit with unauthorized third-party charges on their bills will be due at least $90 million in refunds, the Federal Trade Commission said Friday.

Under a settlement with the agency, T-Mobile agreed to pay another $22.5 million in fines and penalties that will be divided among the nation's attorneys general and the FTC. The FTC sued T-Mobile in July, alleging the company made hundreds of millions of dollars in permitting the unauthorized charges.

Federal authorities have cracked down on large wireless carriers this year for allowing third-party vendors to charge customers for services they did not order, including horoscopes and celebrity gossip. The Consumer Financial Protection Bureau said Thursday that it has filed a lawsuit against Sprint (S) over alleged cramming. And in October, AT&T settled a cramming case for $105 million.

"Mobile cramming is an issue that has affected millions of American consumers, and I'm pleased that this settlement will put money back in the hands of affected T-Mobile customers," FTC Chairwoman Edith Ramirez said in a statement. "Consumers should be able to trust that their mobile phone bills reflect the charges they authorized and nothing more."

Every T-Mobile customer who was hit with the unauthorized charges will get a full refund under the settlement. The company must contact all customers, including those who are no longer customers, to let them know about the refunds.

T-Mobile would typically charge $9.99 each month for the premium services, provided by outside companies. T-Mobile's cut was as high as 40 percent, the FTC said.

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    Mitch Lipka is an award-winning consumer columnist. He was in charge of consumer news for AOL's personal finance site and was a senior editor at Consumer Reports. He was also a reporter for The Philadelphia Inquirer and the South Florida Sun-Sentinel, among other publications.