AT&T customers get $88 million in credits and refunds for illegal charges

Current and former AT&T customers will get refunds or bill credits totaling $88 million within the next 75 days, satisfying the terms of a settlement between AT&T and the Federal Trade Commission, the FTC announced today. The AT&T customers were victimized by "mobile cramming," charges for third-party services that were placed on their phone bills without the customers' authorization.

AT&T agreed to pay for the refunds and credits in a settlement announced in October 2014, and it agreed to notify current customers about the process for applying for refunds. The process, which was led by a third-party contractor that validated each customers' claim, is finally just about over. Some of the money was also recovered from Tatto and Acquinity, two companies that were allegedly behind cramming schemes that affected AT&T customers.

Customers were allowed to apply for refunds for any unauthorized third-party charges that occurred in 2009 and later.

"The refunds represent the most money ever returned to consumers in a mobile cramming case," the FTC said today. "Through the FTC’s refund program, nearly 2.5 million current AT&T customers will receive a credit on their bill within the next 75 days, and more than 300,000 former customers will receive a check. The average refund amount is $31."

The cramming charges were typically $9.99 per month "for ringtones and text message subscriptions containing love tips, horoscopes, and 'fun facts,'" the FTC said. AT&T tolerated the "unauthorized—and illegal—charges," placing them on customers' phone bills despite being aware of the problem. The company made it difficult for customers to seek refunds, the FTC said in 2014.

The bill credits and refund checks will start going out today. Customers with questions about their refunds can call the refund administrator at 1-877-819-9692, the FTC said.

In addition to the refunds and credits, AT&T agreed in the 2014 settlement to obtain customers' "express, informed consent" before placing third-party charges on mobile phone bills. But cramming continued to be a problem for AT&T's landline phone customers, leading to another $7.75 million settlement with the government that AT&T agreed to this year.