Cramming: Is This Sneaky Phone Scam Draining Your Wallet?

Ever glanced at your phone bill and wondered, "What on earth is this charge?" You're not alone. That mystery charge might be the work of cramming, a sneaky trick where third-party companies add unauthorized fees to your phone bill, hoping you won't notice. And the worst part? It's been happening for years, often hiding in plain sight as small fees disguised with vague names like "service fee" or "membership." What can you do about it? We've got a few tips to share — but first, let's look more closely at the world of cramming and how it works.

How do thieves pull off cramming?

Cramming thrives on complexity. Third-party companies unrelated to your phone provider slip charges onto your bill, banking on you not scrutinizing every line. Here's how they manage to do it:

• They get your number: Whether from online contests, shady surveys, or even malware, crammers collect your phone number and link it to their bogus services.
• They bury the charges: They slip in small amounts using generic descriptions like "other fees," hoping they blend in with legitimate charges.
• They stay under the radar: By keeping the amounts small, they count on consumers overlooking the charge or chalking it up to a routine fee.

Big Names, Bigger Fines: Real-Life Cramming Scandals

Cramming isn't just an annoying little scam — it's racked up some serious penalties. Take a look at these high-profile cases where companies paid big for sneaking charges onto customer bills:

• AT&T Mobility (2014): Paid a whopping $105 million in refunds and penalties after customers discovered premium short message (SMS) charges they never authorized.
• Verizon (2010): Refunded up to $50 million to customers following an investigation by the Federal Communications Commission (FCC) into cramming on their bills.
• Gambino Crime Family (2005): Even organized crime got in on the action, as members of the notorious Gambino family admitted to running a cramming operation.

Is cramming still a problem?

You might think cramming has faded into history, but unfortunately, it's still hanging around. Tens of millions of American households have fallen victim to cramming, and while regulatory crackdowns have helped, scammers continue to evolve. Mobile bills, in particular, remain a prime target because people often overlook small charges on their mobile accounts.

Recent cases show just how persistent this issue can be:

• In 2020, the Federal Trade Commission (FTC) sent out $5 million in refunds to people who unknowingly paid for crammed services.
• Since 2013, the FTC has filed seven major cases against mobile cramming operations, underscoring that the problem is far from over.

How can you protect yourself from cramming?

Want to avoid being the next cramming victim? Here are six smart steps to protect yourself:

1. Scrutinize your phone bill: Go through every line, especially the small, obscure charges labeled with terms like "service fee" or "member fee."
2. Call out suspicious charges: If something looks fishy, don't hesitate — call your service provider right away and ask for an explanation.
3. Block third-party charges: Most carriers offer a block on third-party charges. Ask for it and you'll stop crammers in their tracks.
4. Guard your phone number: Be cautious about where you share your phone number — avoid handing it out on sketchy websites, surveys, or contests.
5. Use a credit card for purchases: When buying services, opt for a credit card instead of authorizing charges on your phone bill. Credit card companies offer better fraud protection.
6. Beware of "free" offers: Remember, nothing is truly free. Read the fine print before signing up for giveaways or contests.

Don't Let Cramming Creep Into Your Wallet

Cramming may hide in small charges, but its impact can be huge. By staying sharp, checking your bill, and being careful about where you share your phone number, you can keep your hard-earned money safe from these sneaky scams. Don't give crammers a free pass — take control of your phone bill and protect yourself from unnecessary charges. If you spot something strange, act fast and shut it down.

References: BBB Tip: Overcharged on your phone bill? Watch out for cramming | What is "Cramming?"