FTC Files Its First Case Against Mobile Phone "Cramming"

The Federal Trade Commission has taken legal action to shut down an operation that allegedly took in millions of dollars from placing charges on consumers’ mobile phone bills, many of which were “crammed” or unauthorized charges.

The complaint against Wise Media, LLC, Brian M. Buckley and Winston J. Deloney is the first FTC case against mobile cramming and part of the FTC’s focus on consumer protection issues that may arise from the explosive growth of mobile technology. The FTC’s complaint asks the court to immediately freeze the defendants’ assets and order them to stop their deceptive and unfair practices. The agency is also seeking a permanent injunction that would force the defendants to give up their ill-gotten gains so they can be used to provide refunds to victims of the scam. The defendants allegedly billed consumers for so-called “premium services” that sent text messages with horoscopes, flirting, love tips and other information. The Commission’s complaint alleges that consumers across the country were signed up for these services seemingly at random, and that the operation placed repeating charges of $9.99 per month on mobile phone bills, without consumer knowledge or permission. According to the complaint, in many instances, Wise Media sent text messages to consumers that suggested they were subscribed to the service, which many consumers dismissed as spam and ignored. Even if consumers responded via text indicating that they did not want the services, they were charged on their mobile phone bills on an ongoing basis.