FTC Reply Comment Before the Federal Communications Commission Concerning Placement of Unauthorized Charges on Wireless Bills, Otherwise Known as "Cramming"

Before the
Federal Communications Commission
Washington, D.C. 20554
In the Matter of 	)
)
Empowering Consumers to Prevent and 	) 	CG Docket No. 11-116
Detect Billing for Unauthorized Charges 	)
(“Cramming”) 	)
)
Consumer Information and Disclosure 	) 	CG Docket No. 09-158
)
Truth-in-Billing and Billing Format 	) 	CC Docket No. 98-170
REPLY COMMENT OF THE
FEDERAL TRADE COMMISSION
The Federal Trade Commission (“FTC”) submits this reply comment to address one issue
on which the Federal Communications Commission (“FCC”) has sought further input: the
growing problem of “cramming” on bills for wireless services (“wireless bills”) and potential
regulatory or voluntary industry measures to address that problem. 1 The FTC has extensive
experience combatting the widespread practice of cramming charges on landline telephone bills.
Complaint data from the FTC and other sources indicate that cramming on wireless bills is also a
significant problem. Mobile cramming is likely to continue to grow as cramming schemes
expand beyond the landline platform and mobile phones are more commonly used for payments.
The FTC encourages voluntary industry-led efforts to address mobile cramming, but believes
also that wireless providers should be required to include specific protections for consumers
using wireless devices – most notably, the ability to block all third-party charges. Additional
information must be gathered to determine whether further regulatory or legislative solutions are
1 See Empowering Consumers To Prevent & Detect Billing for Unauthorized Charges (“Cramming”), Report and
Order and Further Notice of Proposed Rulemaking (Apr. 27, 2012) (“Cramming FNPRM” or “Further Notice”).

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necessary to address this problem. As explained further below, it is ultimately in the interest of
all stakeholders here – including regulators, consumer groups, and industry participants – to
ensure that consumers are strongly protected against cramming of unauthorized charges on their
wireless bills.
I. 	The FTC’s Vigorous Law Enforcement Efforts Against Cramming.
The Federal Trade Commission is an independent administrative agency charged with
promoting consumer protection, competition, and the efficient functioning of the marketplace.
The keystone of the FTC’s law enforcement mission is Section 5 of the FTC Act, which
prohibits “unfair or deceptive acts or practices in or affecting commerce.”2 Section 5
encompasses a wide range of business practices, including advertising, marketing, and billing.
The practice of placing unauthorized charges on consumers’ phone bills is prohibited by Section
5 as both a deceptive and unfair practice.3
The FTC has brought more than 25 enforcement actions under Section 5 to halt
cramming practices and provide redress to its victims. 4 These cases have resulted in tens of
millions of dollars in consumer redress and refunded charges, and stringent court orders to
prevent future cramming violations. The FTC works closely with federal and state officials in
investigating and bringing cramming enforcement actions, and has engaged in consumer and
2 15 U.S.C. § 45.
3 See, e.g., FTC v. Inc21.com Corp., 745 F. Supp. 2d 975, 1003, 1005 (N.D. Cal. 2010), aff’d, 2012 WL 1065543
(9th Cir. Mar. 30, 2012).
4 Most recently, the FTC has filed a civil contempt action against the nation’s largest third-party billing aggregator,
seeking the refund of more than $52.6 million in charges allegedly crammed onto landline phone bills in violation of
a court order. See FTC v. Hold Billing Servs., Ltd., No. 98-cv-00629-FB (W.D. Tex.) (filed March 28, 2012); see
also, e.g., Inc21.com, 745 F. Supp. 2d 975; Stipulated Order, FTC v. Nationwide Connections, Inc., No. 06-80180
(S.D. Fla. Sept. 18, 2008); FTC v. Mercury Mktg. of Del., Inc., No. Civ.A.00-3281, 2004 WL 2677177 (E.D. Pa.
Nov. 22, 2004); Stipulated Order, FTC v. Websource Media, LLC, No. H-06-1980 (S.D. Tex. July 17, 2007); FTC v.
Cyberspace.com, LLC, No. C00-1806L, 2002 WL 32060289 (W.D. Wash. July 10, 2002), aff’d, 453 F.3d 1196 (9th
Cir. 2006); Stipulated Order, FTC v. Epixtar Corp., No. 03-8511 (S.D.N.Y. Nov. 29, 2006); Stipulated Orders, FTC
v. 800 Connect, Inc., No. 03-CIV-60150 (S.D. Fla. Feb. 4, 2003); Stipulated Order, FTC v. Access Resources Servs.,
Inc., No. 02-CIV-60336 (S.D. Fla. Nov. 4, 2002).

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business education and outreach programs to raise awareness of the problem. It also has sought
input on the issue from stakeholders – industry participants, consumer groups, and state officials
– including by seeking comments at a recent workshop dedicated to the topic of cramming.5
Based on this extensive experience, the FTC has advocated for reforms that would
eliminate landline cramming.6 In October 2011, the FTC filed a comment in this docket
recommending that the FCC implement rules banning or requiring default blocking of some or
all third-party billing on landline telephone bills.7
In its Further Notice, the FCC seeks input on an issue that was not addressed in detail in
the FTC’s October 2011 comment, but that is becoming increasingly important: the frequency of
cramming on bills to customers of Commercial Mobile Radio Service (“CMRS”) providers, and
in particular “[w]hat steps has industry taken to date and what steps might it take in the future to
protect CMRS consumers.”8 The FTC is focused on this issue, particularly as third-party billing
on wireless bills has become more widespread.9 The FTC devoted a portion of its 2011
cramming workshop to mobile cramming. 10 It also recently held a workshop on mobile
5 See Examining Phone Bill Cramming: A Discussion, May 11, 2011, available at
http://www ftc.gov/bcp/workshops/cramming (“Cramming Forum”). The transcript is available at
http://www ftc.gov/bcp/workshops/cramming/10511phoneworkshop.pdf (“Cramming Forum Transcript”). Written
comments are available at http://www.ftc.gov/os/comments/crammingforum/index.shtm.
6 “Landline” is used synonymously with “wireline” throughout this comment.
7 Comment of the Federal Trade Commission in CG Docket No. 11-116 (Oct. 24, 2011), at 5-6, available at
http://www ftc.gov/os/2011/12/111227crammingcomment.pdf (“FTC Cramming Comment”). Commissioner
Rosch dissented in part because he believes that default blocking of some or all third-party billing is preferable to
banning it entirely. See Cramming Comment at 2, n. 7.
8 Cramming FNPRM ¶ 146. The FTC’s recommendations in its previous comment were limited to landline
cramming. See FTC Cramming Comment at 2 n.5.
9 During the last several years, the FTC has significantly ramped up its focus on mobile technologies, including
mobile payments, to keep pace with the increasing use of these technologies by consumers. The agency has created
a mobile technology unit; developed a mobile lab containing a variety of smartphones, software, and equipment that
permit investigators to collect and preserve evidence and conduct research; and engaged in a host of policy,
enforcement, and educational initiative to promote consumer protections in mobile technologies. See FTC, Mobile
Technology and Consumer Protection Issues, available at http://www ftc.gov/opa/reporter/privacy/mobile.shtml.
10 See Cramming Forum Transcript at 112-155 (transcript of third session).

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payments, which included discussions of the opportunities and challenges associated with
placing third-party charges on wireless bills as a payment method.11
In response to the FCC’s Further Notice, various commenters provided different
perspectives on the extent to which mobile cramming is a problem. The National Association of
Regulatory Utility Commissioners, for example, noted that “evidence abounds that wireless
cramming is a growing problem.”12 A coalition of consumer groups suggested that “wireless
cramming is poised to become a major consumer fraud issue.”13 These comments echo the
FCC’s observation that complaints about cramming on wireless accounts constitute a significant
portion of all cramming complaints it has received and that the percentage of all cramming
complaints that relate to wireless accounts has nearly doubled in recent years.14 In contrast, the
comments of CTIA - The Wireless Association (“CTIA”) suggested that mobile cramming
remains a de minimis concern.15 Verizon Wireless further explained the steps it has taken to root
11 See FTC Mobile Payments Workshop, Paper, Plastic, or Mobile?, Apr. 26, 2012, available at
http://www ftc.gov/bcp/workshops/mobilepayments. The FTC’s interest in mobile payments stems from its broad
jurisdiction over many entities in the mobile payments ecosystem. Mobile payments implicate hardware
manufacturers, operating system developers, application developers, data brokers, loyalty program administrators,
advertising companies, and the many companies that accept mobile payments, just to name a few. The FTC has
jurisdiction over all of these entities. The FTC’s jurisdiction also extends to telecommunications providers when
they are not engaged in common carrier activity. Billing and collection on behalf of a third party is not common
carrier activity. See FTC v. Verity Int’l, Ltd., 443 F.3d 48, 59-60 (2d Cir. 2006); In re Detariffing of Billing and
Collection Servs., 102 FCC 2d 1150 ¶¶ 30-34 (1986).
12 Comments of National Association of Regulatory Utility Commissioners in CG Docket No. 11-116 (June 25,
2012), at 6.
13 Comments of Center for Media Justice et al. in CG Docket No. 11-116 (June 25, 2012), at 18. A participant at the
FTC’s mobile payments workshop also urged greater protections, noting that those who use mobile carrier accounts
for payments have relatively few required protections for fraudulent charges to mobile bills. See Consumers Union,
Comments on the Legal Landscape and Dispute Resolution for Paper, Plastic…or Mobile?, May 22, 2012, available
at http://www.ftc.gov/os/comments/mobilepayments/00022-83036.pdf (recommending that chargeback and other
dispute rights afforded to consumers using credit card and debit cards to fund mobile payments be extended to
consumers billing items to post-paid and pre-paid wireless telephone accounts); Consumers Union, “Mobile Pay or
Mobile Mess: Closing the Gap Between Mobile Payment Systems and Consumer Protections,” at 10-11, 15 (June
2011), available at http://www.consumersunion.org/pdf/Mobile-Pay-or-Mobile-Mess.pdf (same).
14 FNPRM ¶¶ 20, 21, 47, 146.
15 Comments of CTIA – The Wireless Association in CG Docket No. 11-116 (June 25, 2012), at 1 (“CTIA
Comments”).

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out and prevent cramming on the wireless platform and suggests that industry standards are
working to prevent mobile cramming. 16
As explained below, the FTC and FCC have reviewed numerous complaints concerning
unauthorized third-party charges on bills for wireless services in the past few years. As the FTC
has previously noted in the case of landline cramming, the number of complaints almost
certainly understates the full extent of cramming by a substantial amount.17 These complaints
show that mobile cramming is a significant and growing problem.
II. 	Cramming of Unauthorized Charges on Wireless Bills Is a Significant and Growing
Problem for Consumers.
The FTC and FCC have reviewed thousands of complaints of mobile cramming,
including a substantial number in the last few years. The FTC’s review of complaints from the
Consumer Sentinel database – which aggregates complaints filed with the FTC, state Attorney
General offices, most Better Business Bureaus, and numerous other contributors – shows that
consumers have reported over 1800 complaints of unauthorized charges on wireless bills since
2010.18 Similarly, the FCC has reported nearly two thousand mobile cramming complaints,
including a growing number in 2011.19 Many of the complaints reviewed by the FTC involve
recurring charges of just under $10 a month for “premium services” that provide trivia or
16 Comments of Verizon and Verizon Wireless in CG Docket No. 11-116 (June 25, 2012), at 10 (“Verizon
Comments”).
17 See FTC Cramming Comment at 4-5 (explaining that most consumers are unlikely to even notice these
unauthorized charges).
18 For this comment, FTC staff reviewed complaints in the Consumer Sentinel database. The Consumer Sentinel
Network is a secure online database of millions of consumer complaints, available only to law enforcement, that
provides civil and criminal enforcement organization immediate and secure access to fraud, identity theft, Internet,
telemarketing (including Do Not Call), and other consumer-related complaints. See www.sentinel.gov. The count is
based on unverified complaints reported by consumers, and is not based on a consumer survey. Any investigations
of mobile cramming that staff is conducting are nonpublic.
19 The FCC has noted, that from 2008 to 2010, it received between 2000 and 3000 cramming complaint each year, of
which 16% related to wireless consumers. FNPRM ¶ 20. In 2011, it received nearly 1,700 cramming complaints, of
which 30% related to wireless communications. Id. ¶ 21.

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horoscope information by text message (SMS) to a consumer’s phone. Consumers often report
receiving a text message informing them of a subscription to a service of which they have never
heard and that they never requested. And while the consumers who notice the third-party
charges on the bill may be able to get refunds from their wireless providers for some of the
monthly charges, many report being unable to obtain refunds for prior months in which the
recurring charges were undetected. The Consumer Sentinel complaints are consistent in their
content with similar consumer complaints in online forums,20 and they echo the concerns that the
United States Senate Committee on Commerce, Science, and Transportation has raised in
requesting further information on mobile cramming from the country’s major wireless
providers.21
This number of reported complaints undoubtedly reflects a small fraction of crammed
charges on wireless bills.22 In the context of landline cramming, court-accepted surveys found
that only five percent of consumers were even aware of the unauthorized charges from review of
their bills.23 The crammed charges are usually small relative to the overall bill,24 and as noted at
the FTC’s Cramming Forum, phone bills are increasingly paid by consumers using automatic bill
20 See, for example, the many reports of cramming at www.smswatchdog.com and www.textcomplaints.com.
21 See, e.g., Letter from Sen. John D. Rockefeller to R. Stephenson, AT&T, Inc., June 12, 2012, available at
http://commerce.senate.gov/public/?a=Files.Serve&File id=5733e657-f32f-4525-9bea-5f9192c513e5. The Staff
Report on cramming from the Committee on Commerce, Science, and Transportation from July 2011 also noted
consumer reports of mobile cramming. See Staff Report, Senate Commerce Committee, Unauthorized Charges on
Telephone Bills (July 12, 2011), available at
http://commerce.senate.gov/public/index.cfm?p=Reports&ContentRecord id=ea101f28-4df5-4a3f-a63c-
0eca043789be&ContentType id=6a6fef64-34f1-4348-b965-ec03a1dcadfe&Group id=a89b0b93-3242-4d2a-82da-
5e916a62b6a9 (“Senate Commerce Committee Staff Report”).
22 As a reference point, the FCC has received a few thousand landline cramming complaints a year, but as the
FNPRM notes, the available evidence shows that at least hundreds of thousands of consumers have been harmed by
cramming. See FNPRM ¶¶ 20-23; 31-35; Senate Commerce Committee Staff Report at iv.
23 Inc21.com, 745 F. Supp. 2d at 1001.
24 See, e.g., Inc21.com, 745 F. Supp. 2d at 1004; FCC Infographic on Cramming, available at
http://transition fcc.gov/cgb/cramminggraphic.jpg.

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payment services without line-by-line consumer review.25 As the FCC also has recognized, “it
often takes consumers months or years to detect unauthorized charges on their bills – if they
detect them at all – because of the way third parties describe the unauthorized charges or the way
carriers present the unauthorized charges on their bills.”26 Many consumers also may be
unaware that third-party charges may be placed on their phone bills in the first place. There is
little reason to think that the situation is any different for billing to wireless accounts, where
these same factors are present. Moreover, of the consumers that do notice, many may not file a
complaint with the FTC, FCC, or another government agency.
In light of this data, and the longstanding problems with landline cramming, the FTC
believes that additional consumer protections against mobile cramming are needed.
III. 	Consumers Should be Able to Block Third Party Wireless Charges; More
Information Is Needed to Determine Whether Additional Protections are
Warranted.
All stakeholders have an interest in adequately protecting consumers from cramming.
This is a key concern not only for regulators and consumer groups, but also for industry
participants in light of the possibility that consumer dissatisfaction with crammed charges will
undermine broader adoption of wireless provider billing as a payment mechanism, which many
in industry would like to encourage.27 As explained below, the FTC recommends that wireless
providers be required to offer consumers the ability to block third-party charges and to make this
option clear to consumers, so that consumers are empowered to avoid any possibility of
unauthorized third-party charges. Whether industry self-regulation in combination with those
25 See Cramming Forum Transcript at 209-10 (comments of John Breyault, National Consumers League).
26 FNPRM ¶ 22.
27 See, e.g., Cramming Forum Transcript at 139 (comments of Jim Manis, Mobile Giving Foundation); Comments of
AT&T, Inc. in CG Docket No. 11-116 (June 25, 2012) at 5 (“AT&T Comments”); Verizon Comments at 11-12.

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measures will be sufficient to stop mobile cramming, or whether stronger consumer protections
are necessary, requires a harder look at the effectiveness of industry standards.
Some commenters have suggested that the wireless billing platform differs significantly
from landline billing and is less susceptible to cramming. The CTIA has noted that the wireless
industry never developed a practice of charging for various communication services, such as
caller ID or voicemail, because they were always included in the packages that wireless
providers offered to customers.28 Thus, many fraudulent practices in the landline context, such a
billing for so-called “enhanced” services such as voicemail, have not developed in the wireless
billing system. 29 Other commenters note that the wireless billing platform has a variety of
legitimate uses not available through landline billing, including purchase of digital content for
mobile devices.30
Moreover, industry participants regularly cite to the Mobile Marketing Association’s
Consumer Best Practices Guidelines for Cross-Carrier Mobile Content Services (the “MMA Best
Practices”).31 The MMA Best Practices, which have been adopted by the major wireless
providers,32 provide standards for commercial marketing and billing of third-party services.
According to the MMA Best Practices, in order to bill a service to a consumer’s wireless
account, the consumer must affirmatively request the service at two separate steps in the
authorization process, a requirement known as “double opt-in” authorization. At least one of the
requests must confirm that the consumer is in possession of the mobile device to which the
28 Cramming Forum Transcript at 129 (comments of Michael Altschul, CTIA).
29 See id.
30 Verizon Comments at 9.
31 See U.S. Consumer Best Practices Version 6.1, Mobile Marketing Association (Mar. 1, 2011), available at
http://www mmaglobal.com/bestpractice.
32 CTIA Comments at 4.

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charge is billed.33 As one example, a user may order a subscription to a weather alert service by
sending a text to a certain number or by entering her mobile device number on a website; the
consumer then receives a text message detailing the charges to be incurred with instructions to
reply by text message or by entering a PIN code on the website to complete the order.34 In this
way, the provider of the service – the content provider – can be assured that the consumer in
possession of the device actually signed up for the service. As an industry representative
described it at the FTC’s Cramming Forum, this system requires a “pull” by a consumer – an
affirmative action – that is different from the landline context, where third parties often “push”
carrier-billed content on consumers, such as through telemarketing calls.35 Wireless providers
require that content providers billing on their platform adhere to the MMA Guidelines.36
However, it is not clear whether the double opt-in requirement is being consistently
followed or is otherwise effective at stopping cramming. In the Sentinel complaints that FTC
staff have reviewed, consumers often report that they have not even subscribed to premium text
message services. Charges are simply placed without any authorization. In the landline context,
crammers have shown that they are able to fabricate records and thus circumvent requirements
that they prove that consumers have authorized particular third-party charges. For example, in
FTC v. Nationwide Connections, a convicted felon running a cramming operation from his jail
cell was able to charge consumers for collect calls that were fabricated;37 and in FTC v.
33 See MMA Best Practices at 2.6.1; Verizon Comments at 5, 9-10.
34 See MMA Best Practices at 2.6.1, 2.6.2; Verizon Comments at 5. The CTIA, via the Common Short Code
Administrator (CSCA), assigns the five- or six-digit “short codes” that content providers use to communicate with
the consumer. See, e.g., “About the CSCA,” available at http://www.usshortcodes.com/aboutCSCA.html;
Cramming Forum Transcript at 131-32 (comments of Michael Altschul, CTIA).
35 Cramming Forum Transcript at 129-130 (comments of Michael Altschul, CTIA).
36 Verizon Comments at 4-5; CTIA Comments at 4.
37 FTC v. Nationwide Connections, No. 06-80180, First Amended Complaint at 6-9 (S.D. Fla. filed Feb. 27, 2006),
available at http://www ftc.gov/os/caselist/0523141/060921ntwideconnectamndcmplt.pdf.

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Inc21.com, the defendants altered and falsified verification recordings for telemarketing calls
that purported to show consumers’ consent to charges.38 Similar concerns are likely to arise in
the wireless context. Indeed, a mobile security firm recently identified malicious software that,
when downloaded to a consumer’s phone, surreptitiously signed the consumer up for premium
services by sending text messages without the users’ knowledge.39 Moreover, not all “double
opt-in” procedures for premium services require that a consumer affirmatively respond to a
confirmation text message – for example, a user could click through on a website accessed on a
mobile device without viewing the full terms and conditions explaining that the user is
authorizing a charge to a mobile bill.40
Industry comments also point to frequent audits of the content providers whose charges
appear on wireless bills. For example, in order for a content provider to send or receive
commercial text messages to or from a consumer on a wireless provider network, it must submit
details about the commercial campaign it intends to conduct for approval by each wireless
provider. Each wireless provider independently approves whether a content provider can operate
commercially on its network.41 Wireless providers and the CTIA also conduct audits of text
campaigns to ensure that the content provider is following the pre-approved campaign.42
However, a recent lawsuit by the State of Texas shows that this process can be circumvented: as
38 Inc21.com, 745 F. Supp. 2d at 991-92.
39 The malware would also intercept confirmation messages so that consumers would not know they were being
charged. See Lookout Mobile Threat Report, Lookout Mobile Security, 16-17 (August 2011), available at
https://www.mylookout.com/ downloads/lookout-mobile-threat-report-2011.pdf.
40 Wireless Application Protocol (“WAP”) billing enables third-party content to be charged directly to a wireless
subscriber account and is used for content purchases via mobile devices. See Mobile Marketing Ass’n, “WAP
Billing,” available at http://www.mmaglobal.com/wiki/wap-billing. WAP billing transactions can be initiated with
several screen taps on mobile websites with no reply to a text message to the device linked to that account required
for the consumer to opt-in. See MMA Guidelines at 2.18.1.
41 Verizon Comments at 4-5; Cramming Forum Transcript at 133-34 (comments of Michael Altschul, CTIA).
42 Verizon Comments at 6; Cramming Forum Transcript at 129-130 (comments of Michael Altschul, CTIA).

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described in that case, a company was able to sign up consumers for unwanted services through
deceptive websites while employing “cloaking” software that displayed different websites to
state regulators and wireless providers.43
Finally, industry points to voluntary measures to encourage best practices and screen out
bad actors. At least one wireless provider reports that it will suspend and terminate content
providers that meet certain thresholds for monthly billing adjustments.44 CTIA notes that many
wireless providers have adopted arrangements where providers that have a lower rate of
customer complaints receive a larger revenue share than providers that generate more
complaints.45 CTIA also points to arrangements with messaging aggregators – the companies
that facilitate the billing and connection between the wireless providers and content providers –
to provide incentives for aggregators to work only with “reputable” content providers.46
The FTC encourages such voluntary measures and believes that it is premature to
recommend the same protections for wireless third-party billing as it has recommended for
landline billing (i.e., a ban or default blocking on third-party charges).47 In contrast to landline
third-party billing, which has been used almost exclusively by scam artists, the mobile billing
platform has been used for some legitimate charitable activity;48 it also is a potential platform for
43 See State of Texas v. Eye Level Holdings, No. D-1-GV-11-000268 (Tex. Dist. Ct.) (pleadings filed Mar. 11, 2011)
(agreed final judgment entered May 9, 2012). The company also was sued by Verizon Wireless. See Verizon
Comments at 6; see also Cellco Partnership v. Hope, Order and Preliminary Injunction, No. CV 11-0432-PHX-
DOC (D. Az. May 11, 2011), at 4-6 (also describing use of cloaking software).
44 Verizon Comments at 6.
45 CTIA Comments at 5.
46 CTIA Comments at 5.
47 See supra note 7.
48 Cramming Forum Transcript at 139 (comments of Jim Manis, Mobile Giving Foundation).

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consumers to fund mobile payments by placing those payments on their wireless bills.49
However, in light of the significant number of mobile cramming complaints received, and the
potential for expansion of the landline cramming problem to wireless bills, the FTC believes that
some basic consumer protections are needed in mobile billing. At a minimum, all wireless
providers should offer their customers the ability to block all third-party charges. Wireless
providers should clearly and prominently inform their customers that third-party charges may be
placed on the consumers’ accounts and explain how to block such charges at the time accounts
are established and when they are renewed.50 And wireless providers should provide a clear and
consistent process for customers to dispute suspicious charges placed on their accounts and
obtain reimbursement. The FTC believes that such measures should be mandated by law or
regulation to ensure that consumers have baseline protections.
Additional information is needed, however, to determine whether more extensive
regulatory measures are warranted, such as default blocking of all third-party charges for
wireless provider accounts. As noted, the Senate Commerce Committee has recently requested
information from four major wireless providers to better understand the magnitude of cramming
on wireless bills and what is being done to prevent it.51 Further, following up on its mobile
payments workshop, FTC staff is seeking information from industry and consumers groups about
the potential need for default blocking of third-party charges in the mobile billing context, as
well as additional technical or legal protections that may be necessary to prevent mobile
49 FTC staff found 21% of the mobile payment providers it researched for the FTC’s Mobile Payments workshop
offer mobile carrier billing as a means to fund mobile payments. A Snapshot of Select Mobile Payment Providers’
Disclosures -FTC Staff’s Preliminary Observations, slide 5, located at
http://www ftc.gov/bcp/workshops/mobilepayments.
50 Persons establishing family accounts also should be notified of the option to place restrictions on some or all of
the plan phones, such as mobile devices assigned to minor children.
51 See, e.g., Letter from Sen. John D. Rockefeller to R. Stephenson, AT&T, Inc., June 12, 2012, available at
http://commerce.senate.gov/public/?a=Files.Serve&File id=5733e657-f32f-4525-9bea-5f9192c513e5.

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cramming. FTC staff plans to address this issue further in its upcoming report on mobile
payments.
IV. 	Conclusion.
Landline cramming has become a massive problem over the past two decades, affecting
15-20 million households a year, while supporting a billion-dollar industry for scammers.52 That
situation should not be allowed to develop in the wireless context. The FTC believes that
specific consumer protections are needed now – most importantly, the right to block all third-
party billing to wireless bills – and that further assessment is necessary to evaluate the
effectiveness of industry standards and whether further protections in this area are warranted.
By direction of the Commission, July 20, 2012.
52 FCC Infographic on Cramming, available at http://transition fcc.gov/cgb/cramminggraphic.jpg; Senate Commerce
Committee Staff Report at ii.