Feds Crack Down On Massive Text Message Consumer Fraud Scheme

This week, the United States Attorney for the Southern District of New York, in collaboration with the Internal Revenue Service and Federal Bureau of Investigation, announced several arrests of executives at mobile aggregation companies and mobile content providers. The arrests follow a federal investigation of the individuals' participation in a scheme that charged mobile phone users monthly fees for recurring unsolicited text messages, without the customers' knowledge or prior express consent.

What was the nature of the alleged scheme?

The U.S. Attorney alleges that the arrested individuals "auto-subscribed" mobile phone users through the use of a computer program which spoofed the required consumer authorizations for the subject premium text messaging services. The computer program thus forced mobile phone users to pay charges for unsolicited text messaging services, such as horoscopes and celebrity gossip, for which they had not otherwise signed up.  The phone