By Gautham Nagesh
WASHINGTON--The Federal Communications Commission is preparing
to fine Sprint Corp. a record $105 million over allegations the
company charged consumers for unwanted text message alerts and
other services.
An FCC official confirmed that the agency is preparing to fine
Sprint for billing customers for text message alerts, horoscopes,
sports scores, ring tones and other unwanted services--a practice
known as cramming. The fine would tie an AT&T Inc. settlement
over similar charges earlier this year as the largest in FCC
history.
Regulators have targeted a number of carriers for cramming, with
the Federal Trade Commission suing T-Mobile US Inc. in addition to
AT&T's settlement with the FCC. Consumers that believe they
have been overcharged by Sprint would be eligible for compensation
once the fine is approved, according to the official. The dollar
amount of the fine is based on the total amount regulators believe
Sprint overcharged consumers.
According to the official, the FCC's probe focused on a
three-month window from August to October 2013, during which they
said Sprint received almost 35,000 complaints from consumers about
the unwanted charges. The FCC alleges Sprint's actions were a
willful violation, and proposes the company forfeit $105 million to
resolve the investigation.
Both Sprint and the FCC declined to comment.
Three of the five FCC Commissioners have indicated they will
vote in favor of the fine, according to the official. It is unclear
whether Sprint is currently engaged in settlement talks with the
FCC. The official said the investigation was coordinated with the
Consumer Financial Protection Bureau, and various State Attorneys
General.
The FCC's plan was first reported by National Journal.
Write to Gautham Nagesh at gautham.nagesh@wsj.com
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