AT&T Mobility begins ringtone crackdown


DENVER -- If it sounds too good to be true, that's because it usually is. AT&T Mobility is just the first of several wireless operators fined by the Florida Attorney General's office as part of a massive crackdown on fraudulent ringtone companies.

The company agreed to pay $2.5 million in fines as well as refund customers for costs incurred when signing up for purportedly free ringtones and other content marketed by third-party partners. The Florida AG's CyberFraud Task Force is currently suing one such outfit -- the U.S. branch of Italian mobile content provider Buongiorno.

The alleged scam works like this -- companies advertise a free ringtone, wallpaper or other type of mobile content if customers sign up for the "club." Once a member, these companies charge $10-$50 a month for unspecified services that users unknowingly agreed to in the agreement's fine print.

To be clear, AT&T and other wireless operators are not offering the service or advertising it. Third parties like Buongiorno are. AT&T simply has a billing agreement with these companies that allow them to add the monthly fee to users' wireless bill, for a cut.

The refunds AT&T has agreed to could exceed $10 million. The company also agreed to spend $500,000 on a customer education campaign designed to warn users of deceptive Internet advertising, and said it would monitor its partner's activities more closely. Additionally, AT&T agreed to more clearly list charges on its billing statements.

The Florida task force says other wireless operators like Alltel, Sprint Nextel, T-Mobile and Verizon are next on its list, to be followed by smaller regional carriers.