New FCC "Cramming" Proposal Follows Reforms Klobuchar Pushed to Protect Consumers from Bill Shock

Press Release

Today Federal Communications Commission (FCC) Chairman Julius Genachowski released a proposal aimed at making sure consumers have access to clear and accurate cell phone bills free from hidden charges. Last fall, Klobuchar sent a letter to Genachowski urging the FCC to crack down on "cramming," the practice where a third-party adds unauthorized, misleading or deceptive charges to a person's phone bill. Klobuchar serves on the Senate Commerce Committee, which oversees the FCC and telecommunications issues.

"New technology offers more convenience for consumers," said Klobuchar. "The problem is it also offers new opportunities for crooks. This proposal will help make sure that the Federal Communications Commission has the tools it needs to be a vigilant cop on the beat, protecting consumers."

Cramming comes in many forms, but it typically ends up with "mystery charges" buried in the details of a person's phone bill. Cramming has been on the rise because of the proliferation of ever-more sophisticated "smart" cellphones that people use for a variety of functions, including online purchases.

Crammers trick consumers by pretending to offer something for "free" but then apply charges to consumers' phone bills. The monthly charges are listed with vague descriptions, so consumers often do not detect the unauthorized charges for months. Klobuchar held an event in Minnesota this past fall with Prentiss Cox, a consumer protection expert, and Mark Gileczek, a Minnesotan who was a victim of cramming to push for new reforms to protect consumers from deceptive billing practices and bill shock.

Many of the guidelines included in the new proposal are modeled after recommendations that Klobuchar pushed for in a letter to Genachowski last November. Klobuchar urged Genachowski to be more aggressive in both preventing and stopping this fraudulent practice of cramming. At the time Klobuchar recommended new rules she wanted the FCC to adopt, including:

* Requiring that phone bills clearly identify third-party charges, including a clear description of the services being charged
* Establishing clear procedures that companies must follow to authenticate that a consumer has, in fact, agreed to purchase a service that will be charged on their phone bill.
* Holding companies accountable for helping to crack down on crooks who are abusing their access to phone bills for fraudulent purposes.

In order to be adopted by the FCC, a majority of the five commissioners of the FCC will need to vote for the proposal.

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