Cell phone companies rip you off with 3rd party billing

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Cell phone companies rip you off with 3rd party billing
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Cell phone companies have been engaging in a practice that’s been ripping you off! It’s happening most often to those who have an add-a-phone service (where you add a friend or family member to your plan.)

The industry is making huge money doing 3rd-party billing for “services” that other companies claim they’ve provided you — services such as ring tones or joke-of-the-day texts. The cell phone company gets such a large commission for doing this kind of billing, that they’ve been purposely deceptive about the practice.

Some years ago, the Cyberfraud Task Force of the state of Florida went after AT&T for billing their customers for services that they’d advertised as being free. The settlement was over $10 million for Floridians alone.

I know that cell phone bills are impossible to understand; my last bill was 56 pages long! But I make sure to go through it page-by-page each month. About once every four months I’ll find something that’s not legit. (Most recently, I found a $2.95 charge for a ring tone that the provider’s website claimed was free.)

The cell phone companies have no incentive to clean up their act since it’s such a cash cow for them. And according to Smart Money magazine, they go out of their way to make these charges hard to find on your bill. Therefore, YOU need to be the cop for your own phone bill. Here are some action items for you:

  • Look for deceptive terms such as “Premium Content” or “Direct Bill Charge” (sometimes referred to as “DBC” on your bill.)
  • If you find these charges or other suspicious ones, call your wireless carrier and ask for the charges to be removed from your bill.
  • Tell them to block all 3rd party charges going forward.

Editor’s note: This segment originally aired May 25, 2012.

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Clark Howard About the author:
Clark Howard is a consumer expert whose goal is to help you keep more of the money you make. His national radio show and website show you ways to put more money in your pocket, with advice you can trust. More about Clark
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