Over the past two quarters, T-Mobile has accrued more than $50 million to cover the estimated cost of a refund program and settlement payments, both related to unauthorized premium SMS charges.
According to an SEC filing, in the second quarter T-Mobile accrued a $24 million reduction to service revenues to cover the estimated cost of a refund program. For the third quarter the carrier accrued an additional $29 million to cover anticipated settlement payments regarding an ongoing FTC lawsuit over cramming.
In July, the FTC alleged T-Mobile made “hundreds of millions” from unauthorized premium SMS charges on customer bills and didn’t act quickly enough to snuff out the practice. T-Mobile countered by pointing out that all four major U.S. carriers agreed in 2013 to stop cramming. T-Mobile also initiated its own refund program this summer.
But the carrier ultimately decided to negotiate a settlement with the FTC not long after AT&T agreed to a settlement over a similar case. AT&T will refund to customers $80 million as part of a $105 million settlement.
The FTC’s complaint did not specify a restitution amount it was seeking in the T-Mobile cramming complaint but today’s SEC filing from the carrier seems to indicate T-Mobile can ballpark the amount.