(NaturalNews) U.S.-based mobile phone carrier T-Mobile is the subject of a new federal lawsuit alleging fraudulent charges on customers' bills. The Federal Trade Commission (FTC) says T-Mobile unlawfully charged wireless subscribers bogus fees for services they never signed up for, and then deceptively tried to hide these charges on their bills, pocketing millions of dollars in the process.
According to the Associated Press, federal regulators had been unsuccessful in negotiating with T-Mobile prior to filing the suit, which accuses the nation's third-largest wireless carrier of scamming customers. Recurrent charges for so-called "premium" services like horoscope texts and funky ringtones were quietly embedded within customers' bills, alleges the agency, with no clear indication of their presence.
The first of its kind to ever be filed against a mobile phone carrier, the FTC's lawsuit seeks compensatory damages for every T-Mobile customer who was billed for these and other phony services. The agency says stalled negotiations with T-Mobile left it with no other option than to seek intervention from the courts, a move that it hopes will lead to justice.
"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," stated FTC Chair Edith Ramirez in a recent statement.
T-Mobile says third-party providers are to blame for bogus charges
In his company's defense, T-Mobile CEO John Legere told reporters that customers were already being refunded prior to the suit's filing. He maintains that the fallacious charges are a result of third-party vendors deceptively signing customers up for services and tacking charges for these services onto their monthly bills without consent.
It is a common industry practice, in fact, for mobile phone carriers to contract with outside companies that provide mobile phone services, allowing these companies to bill customers directly. In this case, T-Mobile says that these third-party vendors engaged in deceptive business practices that resulted in customers being charged erroneously, something the company has been trying to handle on its own outside of court.
"T-Mobile is fighting harder than any of the carriers to change the way the wireless industry operates, and we are disappointed that the FTC has chosen to file this action against the most pro-consumer company in the industry rather than the real bad actors," said Legere in a statement.
Sprint has been duplicitous about network upgrades for years, and the FTC has done nothing
Interestingly, the FTC has been largely absent in pursuing Sprint, another major U.S. wireless carrier that many have accused of deceptive business practices and fraudulent billing practices. According to data compiled by the Better Business Bureau (BBB), Sprint received more than 22,000 complaints about service and billing between 2008 and 2011 -- almost the same number as T-Mobile -- yet nothing has been done to redress these grievances.
Sprint actually settled a class action lawsuit just last month for engaging in misleading and illegal billing practices, disbursing $20 million to customers in Washington State who were victimized by the Overland Park-based mobile carrier. But to date, the FTC has chosen not to intervene and take federal action against Sprint for committing offenses similar to those of T-Mobile.
"[A]s consumers across the country are ripped off to the tune of millions - perhaps even billions - of dollars a year, corporate America has convinced us that 'frivolous lawsuits' are a drain on the economy and that we need to make it harder to sue them," wrote Justinian Lane for TortDeform, describing her experience of being ripped off by Sprint of hundreds of dollars in phony tax charges.
"Too bad no one wants to make it harder for corporations to rip us off, eh?"