CFPB Sues Sprint Over 'Cramming' That Cost Customers Millions

The U.S. Consumer Financial Protection Bureau has filed a lawsuit against Sprint, alleging the company illegally billed wireless customers for millions of dollars in unauthorized charges through a practice known as "cramming."

The lawsuit is the third such action the government has taken to combat "cramming" charges on cellphone bills this year, Reuters reports. In October, the Federal Trade Commission reached a $105 million settlement with AT&T over its cramming practices after earlier filing a lawsuit against T-Mobile.

What does the government allege in its latest lawsuit against Sprint?

Unauthorized Third-Party Charges

In its lawsuit, CFPB claims that Sprint unfairly billed customers by enrolling them in third-party billing without their authorization, failing to implement adequate compliance controls, and failing to resolve disputes. The suit also claims that Sprint ignored numerous red flags and other warnings from customers, government agencies, and consumer protection groups regarding these unauthorized charges.

The lawsuit seeks civil damages and penalties, restitution to customers, and an injunction against future violations of the federal Consumer Financial Protection Act. The CFPA prohibits, among other things, a business from engaging in "engaging in an unfair, deceptive, or abusive act or practice."

In a statement, a spokesman for Sprint disputed the allegations made in the CFPB's complaint. "We strongly disagree with (the CFPB's) characterization of our business practices," the statement said, according to Reuters.

CFPB Sues Sprint Over 'Cramming' That Cost Customers Millions by FindLaw