Bombastic T-Mobile CEO John Legere responded forcefully when the Federal Trade Commission filed suit against the Un-carrier over the summer for profiting from so-called "cramming." That's when a carrier allows third-parties to add premium SMS charges to customer bills without proper warning. Today the FTC has announced T-Mobile is settling the case for $90 million, most of which will go to customers who were charged for unauthorized services.
All US carriers banned cramming late last year, but the FTC has been investigating and filing suits all through 2014. AT&T settled in October for $105 million, while a Sprint case is still ongoing. T-Mobile previously said it had proactively been refunding money to customers, but apparently that wasn't good enough for the FTC.
Most of these unauthorized charges were $9.99 per month subscriptions to daily horoscopes, sports updates, and celebrity news delivered by SMS. They were easy to accidentally sign up to and hard to cancel. $67.5 million of the money will go to refunds for customers, who must be contacted by T-Mobile and made aware of the refund program. The settlement requires they pay out at least that amount. It could creep higher if more customers request refinds. The remaining $22.5 million goes to cover government fines.