Verizon Wireless Files Lawsuit To Stop Premium SMS Fraud
This week, Verizon Wireless announced that it had filed a lawsuit against defendants who are running deceptive SMS campaigns. Like other carriers, Verizon allows subscribers to purchase content -- such as ring tones, wall paper, and news alerts -- from third parties. Verizon requires that content providers follow the MMA’s Best Practice Guidelines and clearly disclose the costs of their offers. Before approving a premium campaign, Verizon reviews the campaign to ensure it complies with the Guidelines.
Verizon alleges that the defendants conspired to defraud Verizon and deceptively marketed their content to subscribers. Among other things, Verizon argues that the defendants: (a) activated dozens of short code campaigns using false names and addresses; (b) used deceptive web pages that differed from the ones they submitted to Verizon; (c) failed to clearly disclose the costs of their offers; and (d) failed to get adequate consent from consumers.
Verizon alleges that the defendants’ conduct violates various civil and criminal laws. The carrier is seeking unspecified damages and has asked the court for an injunction to put an end to the scheme. As with other lawsuits in this area, the key lesson for marketers is that they need to clearly disclose the material terms of their offers, including the prices associated with those offers. Marketers should consult the MMA’s Best Practice Guidelines for tips on how to do this.
Click here for an article in Mobile Marketer in which I discuss the case in more detail.
Tags: Mobile Marketing