Feds Go After T-Mobile in Cramming Case

WASHINGTON (AP) — Federal regulators are urging T-Mobile customers to go through their phone bills line by line.

They're accusing T-Mobile US of charging customers for premium services, like horoscope texts and quirky ringtones that customers never authorized.

The Federal Trade Commission has filed suit against the phone company in a federal court in Seattle.

The lawsuit, the first of its kind against a mobile provider, is the result of months of stalled negotiations with T-Mobile, which says it is already offering refunds.

"It's wrong for a company like T-Mobile to profit from scams against its customers when there were clear warning signs the charges it was imposing were fraudulent," FTC Chair Edith Ramirez in a statement.

The practice is called "cramming": A third party stuffs a customer's bill with bogus charges such as $10-per-month horoscopes or updates on celebrity gossip. In this case, the FTC said, T-Mobile was working with third-party vendors being investigated by regulators and known to be the subject of numerous customer complaints. T-Mobile then made it difficult for customers to notice the added charge to their bill and pocketed up to 40 percent of the total, according to the FTC.

In a statement, T-Mobile called the allegations "unfounded and without merit" and said it blames the third-party vendors for the erroneous charges. T-Mobile also said it is already reaching out to customers to provide refunds.

The Federal Communications Commission says it has launched a separate inquiry into allegations that T-Mobile potentially made hundreds of millions of dollars in fraudulent charges.