Earlier this week, the United States Federal Trade Commission (FTC) accused T-Mobile of knowingly charging its customers hundreds of millions of dollars for “Premium SMS” services, the kind of services that you could sign up for to receive horoscopes and other oddities via SMS. The FTC said that T-Mobile continued to charge its customers for these services and even made it hard for them to take the charges off of their account.
T-Mobile CEO John Legere immediately responded to the report and said that the FTC’s allegations were “unfounded and without merit” and that the FTC should point fingers at the third party Premium SMS providers instead of at T-Mobile. Now, on Thursday, Legere published a new letter in which he officially plants his feet in the ground and tries to clear up the situation.
“The FTC certainly did a good job of sensationalizing their story and their news at the expense of both T-Mobile’s reputation and mine,” Legere wrote. Legere said that T-Mobile isn’t participating in any of the “cramming” practices – those like Premium SMS that add extra charges to a bill. He does admit that T-Mobile, in addition to other carriers, did participate in Premium SMS services between 2009 and 2013.
“We were billing for these services on behalf of the content providers who were responsible for obtaining the customers’ authorizations,” Legere explained. “As we all know now, there were some fraudsters in that bunch. That is why, as we found them, we terminated them and, ultimately, made the decision in November 2013, as did all four of the wireless companies, to eliminate this from our service offerings.”
Legere said the FTC’s claims that T-Mobile stole hundreds of millions of dollars are “incredibly overstated.” He said that T-Mobile has created a Proactive Refund Program that will help issue refunds to customers who believe T-Mobile billed them for unwarranted services and that the Proactive Refund Program is going live “in a few days.”
Legere said the conversation will continue. There are two sides to every story, but clearly the FTC has specific concerns with T-Mobile’s operation.