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Verizon offers refunds for fraudulent SMS messages

Nancy Gohring | March 9, 2011
Verizon on Wednesday said that it filed a lawsuit this week against a group of people and related companies that it alleges duped people into signing up and getting charged for premium short message services.

However, the terms and conditions of the service are grayed out and users would have to scroll down on the page to see them, violating the operator's instructions for informing customers of costs, Verizon said. If users entered their mobile number, they received a PIN that let them opt into the service. However, the PIN entry page did not disclose subscription information as required by the operator's terms, Verizon said.

The operator also claims that the defendants redirected IP addresses they knew were used by Verizon auditors away from the noncompliant sites. That meant when a Verizon auditor tried to click on an advertisement for one of the noncompliant offers, they were redirected to other pages including or one of the compliant offers. The auditors began using IP masking software in order to view the sites presented to consumers.

In a statement, Hope said he is "disappointed and distressed that the Texas Attorney General and Verizon Wireless have filed these two lawsuits which are designed to significantly harm our business and stifle our right to speak freely with our customers." He said neither the Texas attorney general nor Verizon contacted Jawa before filing the suits. He also said the company is unaware of any customer complaints in Texas. He called the lawsuits "misinformed" and said others that might follow suit would be "misguided."

The Better Business Bureau does not list any complaints against Jawa. However, Hope's company Cylon, which Verizon names as a defendant, has 37 complaints registered against it with the bureau over the past three years. The bureau has processed and closed all of the complaints.

Verizon is asking for a jury trial and seeks damages for harm to its reputation, expenses incurred in handling thousands of customer complaints and expenses required to reimburse customers for the unauthorized charges.

On the site customers can use to file claims, Verizon lists 120 short codes and campaign names that it is offering refunds for.

Jawa seems to be doing well with its premium message business. In a local news station's profile of the company, Jawa boasts that it offers employees catered meals, a Ping-Pong table, and a tropical-themed nap room, complete with sleeping pod that "comes from England and has a James Bond, Dr. Evil feel," according to one employee.


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