Cramming on Wireless Phone Bills: A Review of Consumer Protection Practices and Gaps
Senate Commerce Committee
July 30, 2014
Over two decades ago, phone companies began allowing third-party vendors to place charges on consumer phone bills for products unrelated to phone service such as photo storage. From the early days of this practice, industry representatives have promised to protect consumers against unauthorized third party charges. However, the Committee’s 2010-11 review of third-party billing on landline phones found that “cramming” – where fraudulent charges are placed on consumers’ phone bills – had been occurring for several decades and was estimated to have cost consumers billions of dollars.
In light of increasing consumer use of mobile phones and emerging evidence of cramming in this context, Chairman Rockefeller in 2012 opened an inquiry to examine the scope of wireless cramming and industry practices to protect consumers against unauthorized charges on their wireless bills. The hearing will review findings of the Chairman’s wireless cramming inquiry and examine consumer protections as carrier billing technologies and practices continue to evolve.