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Verizon Crime The Almighty Buck

Verizon, Sprint Agree To Pay Combined $158 Million Over Cramming Charges 66

mpicpp sends news that Verizon has agreed to pay $90 million (PDF), and Sprint another $68 million (PDF), to settle claims that they placed unauthorized charges on their customers's bills. The process, known as "cramming," has already cost T-Mobile and AT&T settlements in the tens of millions as well. Most of the settlement money will go towards setting up refund programs, but Verizon and Sprint will be able to keep 30% and 35% of the fees they collected, respectively. In response to the news, both companies issued vague statements about "putting customers first." They are now banned from charging for premium text message services and must set up systems to ensure informed consent for third-party charges.
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Verizon, Sprint Agree To Pay Combined $158 Million Over Cramming Charges

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  • That'll Show 'Em (Score:5, Insightful)

    by tapspace ( 2368622 ) on Tuesday May 12, 2015 @08:17PM (#49677889)

    No doubt these meager fines will deter such practices in the future...

    • by Anonymous Coward on Tuesday May 12, 2015 @08:26PM (#49677935)

      Hey, that's not fair. They worked hard for that money, it's not like the people with the phones will miss it, now is it? They didn't work hard for it, otherwise they would have been running their own businesses, rather than working for someone else. What right has the government got to be involved in private business, anyway? (Insert other such stupidies as required.)

    • by Greyfox ( 87712 )
      They should just pick a number, convert it all to nickels and make the CEO shove them all up his ass. In a televised venue. I bet no company would ever break the law again. At least, not after the first one.
    • by Fwipp ( 1473271 ) on Tuesday May 12, 2015 @08:43PM (#49678029)

      Total revenue from cramming: $X
      Total fees: $X * 0.65
      Revenue after getting caught doing an illegal thing: $X * 0.35

      With penalties like these, there's not even a risk/reward calculation. If you break the law and don't get caught, you're way ahead. But if you break the law and get caught, you're still ahead. There's literally no reason *not* to be evil.

      • by ShanghaiBill ( 739463 ) on Tuesday May 12, 2015 @09:06PM (#49678149)

        There's literally no reason *not* to be evil.

        Well, there is the damage to their reputation

        .
        .
        .

        Just kidding!!!

        • by guruevi ( 827432 )

          Even if it did, where are you going to go. Nice communications you've got there, it would be a shame...

          In practically any market in the US, there are only ~2-5 players, all of them collude on prices and service.

      • by Anonymous Coward on Tuesday May 12, 2015 @10:00PM (#49678373)

        So let me get this right,

        If I rob a bank and take $100 Million dollars

        a) There would be no prison time for the crime
        b) I get to keep $35 Million for my efforts

        So, if Corporates are people too, surely people can be corporates and treated "fairly" too

      • by TheRaven64 ( 641858 ) on Wednesday May 13, 2015 @05:19AM (#49679823) Journal
        And yet, when the EU (which understands this and makes fines sufficiently large to discourage the behaviour) goes after a US corporation, there are cries of the EU just being jealous of the success of US companies and wanting their cut of the revenue.
      • The summary mentioned the premium text messages, these are messages that are sent by third parties and money from them goes to the third party, so it is more like a 150% fine, not 65% as some of the money from the premium text message went to the third party which doesn't have to refund the money.

        Unfortunately, the third parties were never forced to advertise that requesting these messages caused the fees at all.

    • by wbr1 ( 2538558 )
      Verizons NET revenue in 2014:9.625 billion [wikipedia]
      Damages 90M Percentage fees take from net profit = 0.9%

      Less than one percent of one years profit for fucking customers for years. Yeah, that'll teach 'em.

      As usual, this is a show and a sham. Bet some lawyers will make bank though.

    • Obviously (Score:4, Informative)

      by Pollux ( 102520 ) <<ge.ten.atadet> <ta> <reteps>> on Tuesday May 12, 2015 @10:14PM (#49678423) Journal

      Of course it will deter them! Obviously, when you admit that you did wrong and accept responsibility for your misdeeds, the guilt and shame must be overwhelmingly embarrassing! Let's see how hard the hammer of the FCC came down this time...

      This Consent Decree resolves allegations that Verizon charged consumers for third-party products...The Bureau...contends that Verizon violated the law...To resolve the Bureau’s investigation...Verizon will provide a total of $90,000,000 in payments and funds for consumer redress...the public interest would be served by adopting the Consent Decree and terminating the referenced investigation.

      Hmm...I'm confused...[CTRL]-[F]..."Guilty"...No Results Found? ...

      Serving the public interest my ass. Ninety million bucks says Tom Wheeler [wikipedia.org] goes to work for one of these companies the moment he leaves office.

  • it is unlikely I had picked an honest one.

    But, better than even money?

    This will not encourage the creation of an honest cell phone provider that football stadiums are frequently named after.

  • Does "cramming" include the carrier itself adding a data plan that the customer doesn't want? One of their competitors is known to do that [slashdot.org].

  • by l0ungeb0y ( 442022 ) on Tuesday May 12, 2015 @08:56PM (#49678103) Homepage Journal
    Helping Corporations turn Crime into Billion Dollar Business Models. Can't wait to see what Amazing Verticals the Free Health Care Market comes up with.
    • Oh shut the !@#$ up... It's all the government's fault, so you say. Yes. Bad corporate behavior is enabled by government. And I'm sure that without government around, they wouldn't have done it? B. !@#$ing S.

      You need to go back and look at history some more to see what companies got up to when there wasn't government insight. There's a nice little historical place in my home state, a canyon that held a mine. The workers in that mine were not paid very well, and they had to rent their barracks, and they

      • Now, I'm pissed as anyone else that I'd get years in prison if I stole this much, and let's not mince words here.... The phone companies STOLE, and someone should be in prison. But don't go blaming this on the !@#$ing government. That's just your own little petty hatred.

        You agree that they are COMMITING CRIMES -- yet you call me petty and hateful and to shut the fuck up when these CORPORATE PERSONS face no ciminal charges, pay a fine they can just as well pass on the customer and GET TO KEEP the ill got gains? Do you realize this is standard operating procedure in the US? That time and time again the Corporate Persons commit crimes that NET THEM HUNDREDS OF MILLIONS IF NOT BILLIONS IN PROFITS and pay only a Percentage in fines? It's clear you have missed the point that C

  • by NoKaOi ( 1415755 ) on Tuesday May 12, 2015 @09:00PM (#49678117)

    Verizon and Sprint will be able to keep 30% and 35% of the fees they collected

    WHAT THE FUCK? So pretty much they do something illegal, and only have to give part of the proceeds back?
    Found the question mark:
    1. Commit fraud
    2. Get caught
    3. Bribe^H^H^H Lobby politicians
    4. PROFIT!

    • This says so many things about the current state of affairs in this country, pretty sad isn't it? I wonder when we will see a spike in vigilante justice?
      • by Anonymous Coward

        Yeah. Most notably, that the summarizer didn't understand the original article.

        The 30 - 35% refers to the amount of money that each company made from the premium text messages.

        • What a shame to waste good karma. You are of course exactly right, and the article makes no mention of the amount of the actual amounts that the companies benefitted from due to cramming. One hopes they got fined more than they charged, but I kind of doubt it. As much as they were getting per cram, I have to think they made billions.
  • by bjwest ( 14070 ) on Tuesday May 12, 2015 @09:11PM (#49678187)

    ...Verizon and Sprint will be able to keep 30% and 35% of the fees they collected, respectively.

    Both companies do something illegal and still get to hold on to 30% or more of the money? They should be paying that 30 to 35 percent in excess to the customers they ripped off, court costs and fees, 100% of lawyer fees, plus a hefty fine. The victims should be getting 130% of their money back.

    What kind of shit is this, DOJ? How in hell is this going to deter this type of behavior in the future? I'll tell you how - it's not. It will encourage it as just another revenue stream.

    • Of course it gets better. They will use this fee to lower their income to reduce the taxes owed and they will just charge more for their plans to recoup the fees in the longer term. If you want to stop companies from doing this type of stuff then you have to hold the management and executives accountable. Get warrants, find out who authorizes these programs (though in cases like this where it's pretty much public knowledge you can go after the board for not stopping the practice at least), and at a minim

  • by MinamataHG ( 2621917 ) on Tuesday May 12, 2015 @09:19PM (#49678235)

    Some people above just realized there are actually living in a corporatocracy. The rest is smoke and mirrors.

  • by Poisonous Drool ( 526798 ) on Tuesday May 12, 2015 @10:00PM (#49678371)
    Good luck. AT&T crammed my bill for $250 and I'm still waiting for my check. It's been years.
  • by Anonymous Coward

    Where do I go to sigh up to commit a robbery, get caught, not go to jail, and keep 30% to 35% of the take.

  • It's corporate business as usual in America. These crooked companiez benefit regardless of the fines. Restitution isn't required, the executives who initiate these programs keep their bonuses and the companies' cash flow is enhanced by the use of ill gotten gains. Additionally, anything paid through credit cards fills the tills of big banks and the interlocked corporate directorships as well as the 'investors'.
  • ordering those kind of actions getting slapped in any way?
    Criminal investigation, putting those crooks in court - anything like that?
    No, company pays for it, and in end stockholders and customers.
    And, not to forget who else gets a cut on those deals? Any idea, like lawyers, negotiators, what their compensations are on those with those numbers - all behind closed doors for good reasons... Sure, they don't have to deal with minimum or living wage issues.

  • But only under duress. And by implication it means that in other circumstances they're not put first.
  • When companies steal from their customers or anyone else they should be forced to pay far, far more than what they took in. If they stole two million fine them two hundred million and the nonsense will stop. Allowing any profit from wrong doing cause more crime.
  • That's 1/2252000000 of Verizon's entire Market Capitol ..

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