FTC cracks down on mobile cramming operation

ID-100128578Paying the cellphone bill is expensive enough without someone tacking on extra charges for services you don’t use and never asked for. The Federal Trade Commission (FTC) just announced it is taking action against a mobile cramming operation that billed consumers tens of millions of dollars without permission.

The FTC complaint seeks to shut down the operation and recover money for consumers. The complaint alleges that Lin Miao and Andrew Bachman used a number of companies to pitch things like love tips, fun facts and celebrity gossip in text messages. The defendants allegedly placed monthly subscription fees for these “services” on consumers’ bills without permission.

The practice known as mobile cramming, counts on that fact that consumers don’t always closely look at their monthly statements, or that if they do, consumers might assume the charges are legitimate.

In addition to cramming charges on consumers’ bills, the defendants allegedly used deceptive website offers to get consumer phone numbers they could use to sign people up for services without their knowledge. One example involved telling visitors to a website that they had won Justin Bieber tickets which they would receive after filling out a quiz. The quiz included their phone number. They never received the tickets, but were likely signed up for a paid service.

Consumers were continuously billed until they noticed the charges and unsubscribed. Charges were typically $9.99 per month and were listed on bills with names like “77050IQ12CALL8663611606” and “25184USBFIQMIG.”

Getting refunds was often difficult, with refunds promised that never arrived or only partial refunds being delivered. With refund requests as high as 40 percent in some months, some carriers suspended the defendants from billing consumers.

The FTC alleges that the defendants violated the FTC Act by misleading consumers into believing they had to pay for the premium text message services and by unfairly billing consumers for services they did not ask for.

Defendants are Tatto, Inc. (also doing business as WinBigBidLow and Tatto Media); Bullroarer, Inc. (also doing business as Bullroarer Corporation Pty. Ltd.); Shaboom Media, LLC (also doing business as Tatto Media); Bune, LLC; Mobile Media Products, LLC; Chairman Ventures, LLC; Galactic Media, LLC; Virtus Media, LLC; Lin Miao and Andrew Bachman.


1 Comment

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One response to “FTC cracks down on mobile cramming operation

  1. Mark Burrows

    You know what I use my cellphone for? Well making and receiving phone calls away from home. I simply refuse to accept or even initiate the text option. When I go onto sites with my computer and they ask for my cellphone number, I never provide it. If they insist, I just put in my home fax number and let my fax machine answer any network calls. Of course they do not speak the same language, but they try. It’s kind of amusing.
    I am not interested in contests, I am not interested in using my cellphone as a confirmation device. The parameters and preferences I set up for my smart phone is for me to get out, not the world to get in. For me it works as a telephone and an internet device to look up information as needed when I am out and about. Often I have my tablet in my pocket and prefer to use that instead for internet. The only thing that comes into my phone is, phone calls from the people I know, and the odd wrong number that anyone can receive. When I’m home, the cellphone is shut off, the tablet is shut off and the computer is turned on. Before I go to bed I shut off the computer and turn on my tablet in case something pops into my head before I nod off and I need to make a note or look something up.
    Yes, some of you may defend that having one portable device that can do it all is the way to go, but I can not disagree more. Since there is no portable device that has the power of a computer yet. I am not going to haul my laptop everywhere because I no longer have to. My tablet is my information tool and I can bookmark anything I wish then retrieve it later for download on my computer. No sense in taking up the limited storage space on my tablet when I have 4 terabytes plus at home.
    Both my phone and tablet can take pictures, although it’s a touch more awkward with the tablet. On the other hand, with the tablet I have a much larger keyboard which is much friendlier than the one on the smartphone and I can transfer from one to the other easily enough then cross platform to my computer later.
    Point being, I’m not being cheap, I’m being practical. I am not paying for services I don’t want and I never go beyond my monthly limit, so if the bill is ever higher than what it is normally, I would jump all over it.
    I already had my cell provider try to jack up my rate, and I contacted them immediately and informed them that if they did, they would be in breach of the contract I signed and agreed to that there would be no increase of rate during the term of my contract, and if they so choose to breach, I would be quite eager to not only seek out a choice deal with their competitors, I would inform everyone that they are trying to pull a fast one on contract holders.
    So, it isn’t just scam artists, the major companies are tricky devious characters as well and need to be kept an eye on. If they can pull a stunt and get away with it, they will.

    Mark Burrows

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