AT&T cramming: Part 2

In 2011, a miscreant abused AT&T’s Wireless Access Protocol payment system and add unauthorized charges to my account. When I noticed the charges, I called AT&T. After getting the initial “we can only refund 3 months” runaround, I escalated the matter  until I got a full refund. I also had AT&T add Purchase Blocker to all 4 of my lines.

Today I logged in to my AT&T account and noticed that, quite helpfully, AT&T now highlights these “billed mobile purchases.” Unfortunately, two new recurring charges were added to my account in January. Jesta, one of the companies behind the crammed charges are self-professed scammers that were fined $1.2M by the FTC in August. As part of the judgement, they are required to refund all charges when customers request it.

AT&T knowingly allows these scammers to bill AT&T customers, which greatly peeves me. I tallied up the charges, called AT&T, and requested a full refund. After getting the same “we can only refund 60 days” runaround, I again escalated the matter and have a full refund being processed. AT&T has no idea why Purchase Blocker got dropped from two of my lines but it has been re-added.

The most interesting part is the email excerpts from Jesta cited in the FTC complaint. Beyond admitting their business is a scam, they discuss ways to keep their return rate below 17%, the rate at which T-Mobile takes away Jesta’s ability to charge customers. AT&T cares even less for their customers and is willing to let scammers reach a 18.5% return rate. Is there any legitimate business with return rates above 10%?

3 Replies to “AT&T cramming: Part 2”

  1. What’s the “benefit” you get for involuntarily receiving recurring charges to your ATT accounts?

    In other words, How do they pitch their scam?

    And how is one company (Scammers-Are-Us) able to hide behind another’s good reputation (ATT presumably),

    apparently with ATT’s blessing, and tap in to their billing process?

    The scammers must pay ATT for that level of access to ATT’s customer base.

    I hope the FTC busted them both.

    But then to require the customer/victim to continue to jump through hoops to avoid bogus recurring charges???

    And what “blockers” have they failed to keep up to put an end to this financial shell game?

    Sounds to me like you could go after their entire $1.2M slush fund and then some, and every one of their customers should follow suit.

    Caveat emptor all over again, eh?

  2. > What’s the “benefit” you get for involuntarily receiving
    > recurring charges to your ATT accounts?

    It’s a service that AT&T offers their valuable customers, in the same way that a bull services a cow. Unless one is in the habit if frequently looking at their detailed bill, this type of thing is very easy to not notice.

    > In other words, How do they pitch their scam?

    Complete details are in the FTC complaint linked in my post. In a nutshell: fraud.

    > And how is one company (Scammers-Are-Us) able to hide behind
    > another’s good reputation (ATT presumably), apparently with ATT’s
    > blessing, and tap in to their billing process? The scammers must pay
    > ATT for that level of access to ATT’s customer base.

    AT&T provides 3rd parties with the ability to sell products and charge customers phone bills. All the carriers offer this “service.” Some of the 3rd parties are legit, selling ringtones, music, and games. Many, and I suspect most, are not.

    > I hope the FTC busted them both.

    I suspect a lawsuit is what compelled AT&T to offer the purchase blocker service in the first place. It took a class action before AT&T ceased 3rd party billing on land lines, and I expect it’ll take another class action suit and more FTC penalties before they discontinue it on mobile.

    > But then to require the customer/victim to continue to jump through hoops
    > to avoid bogus recurring charges??? And what “blockers” have they failed
    > to keep up to put an end to this financial shell game?

    It’s a matter of profit. The FTC estimates there’s about $2B a year in cramming charges. I figure based on market share, AT&T facilitates roughly 40% of that. If they pocket just half of the take, they’ve got about 400M reasons to allow the abuse to continue.

    > Sounds to me like you could go after their entire $1.2M slush fund
    > and then some, and every one of their customers should follow suit.

    The $1.2M is just the fine that Jester Media paid the FTC. The customers refunds are paid out in addition. AT&T got didn’t get stung on this one.

    But, you’re thinking along the right lines. AT&T recently did get their chops busted with a class action lawsuit that *finally* prompted them to discontinue 3rd party billing on land lines. Verizon has had just as many legal issues.

    My guess is that greater than 90% of the land line 3rd party charges were fraud, and that 90% of the 3rd party charges happen on mobile. So AT&T could make this concession on land lines as part of the settlement while also letting the vast majority of the fraud continue. If you’re making $400M/yr on the abuse, how much of a deterrent is a puny $1.2M settlement?

Leave a Reply

Your email address will not be published. Required fields are marked *