By Alan Zibel
WASHINGTON--The U.S. consumer-finance regulator filed its first
legal action against a telecommunications company on Wednesday,
accusing Sprint Corp. of hitting mobile phone customers with
unauthorized charges.
The Consumer Financial Protection Bureau sued the wireless
carrier in federal court in New York, alleging the company unfairly
charged customers by creating a billing system that allowed outside
companies to place unauthorized charges on customers' bills.
The CFPB said the charges ranged between 99 cents a month and
$9.99 a month. The CFPB said it cooperated with the Federal
Communications Commission on the case.
A Sprint spokeswoman said the company strongly disputes the
CFPB's depiction of its business practices. The company "took
considerable steps to protect wireless customers from unauthorized
third-party billing and is an industry leader in proactively
preventing unauthorized charges," she said.
The Federal Communications Commission is preparing to fine
Sprint $105 million over similar cramming practices, The Wall
Street Journal reported Tuesday.
Write to Alan Zibel at alan.zibel@wsj.com
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