FTC: Wireless Customers Should Be Able To Block All Third-Party Charges To Phone Bill

While the FCC has recently enacted rule changes that make it more difficult for predatory third-party businesses to cram unwanted and unauthorized charges on consumers’ landline phone bills, it is still in the process of considering what to do about bill-cramming for wireless customers. For what it’s worth, the folks at the Federal Trade Commission have chimed in with their suggestion: Wireless providers should be required to give customers the option to block all third-party charges from their bills.

In response to the FCC request for comment on the topic of wireless cramming, the FTC says it has reviewed thousands of consumer complaints in recent years about these tacked-on charges — often less than $10 and for unwanted nonsense like trivia and horoscopes — from third-party service providers. But for all the complaints the agency has seen, it believes this is just the tip of the iceberg.

“Mobile cramming is likely to continue to grow as cramming schemes expand beyond the landline platform and mobile phones are more commonly used for payments,” writes the FTC in its comments [full PDF here].

However, while the FTC recommends that all consumers should have the option to block third-party charges, it does not yet recommend an outright ban on third-party billing or having blocked billing be the default setting.

“In contrast to landline third-party billing, which has been used almost exclusively by scam artists, the mobile billing platform has been used for some legitimate charitable activity,” explains the FTC in a statement. “It also is a potential platform for consumers to fund mobile payments by placing those payments on their wireless bills, the comment states.

So what exactly should the FCC require of wireless carriers?

Writes the FTC:

At a minimum, all wireless providers should offer their customers the ability to block all third-party charges. Wireless providers should clearly and prominently inform their customers that third party charges may be placed on the consumers’ accounts and explain how to block such charges at the time accounts are established and when they are renewed. And wireless providers should provide a clear and consistent process for customers to dispute suspicious charges placed on their accounts and obtain reimbursement.

In May, the FTC accused the country’s largest third-party billing company of cramming upward of $70 million worth of unauthorized charges on consumers’ landlines between 2006 and 2010.