FCC finally officially bans both ‘slamming’ and ‘cramming’ phone fraud

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• The illegal practices of "slamming" and "cramming" phone customers are now officially banned under FCC guidelines.
• Cramming is when phone providers put bogus charges on phone bills in the hopes customers won't notice and pay anyway.
• Slamming is when phone providers use fraudulent tactics to switch customers from one service to another.

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The Federal Communications Commission in the United States finally placed an official ban on the illegal practices of "cramming" and "slamming" telephone bills. The practices are already federal crimes but weren't violations of FCC code until now.

The FCC — led by Ajit Pai, pictured above — hopes that this new policy will help curb both slamming and cramming in the world of both landline and mobile telephone service.

In the phone industry, "cramming" is the practice of loading superfluous or sometimes bogus charges onto phone bills in the hopes that the customer simply won't notice. These charges can sometimes be disguised as a small tax or something vague like a "convenience fee." The phone provider hopes that the customer won't notice the extra charge and simply pay the bill.

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AT&T in 2014 was forced to pay out $105 million for cramming charges onto customer bills. Some of those charges were for things like trivia, horoscopes, and love tips services. AT&T allegedly kept up to 35 percent of the profits from these charges.

The other fraudulent practice that is now banned under FCC guidelines – "slamming" – is when phone providers trick you into switching services or carriers by obfuscating information or by fabricating customer approval.

An example of this would be taking the recording of a sales call for something unrelated to your phone bill – like a sweepstake or contest of some kind – and then piecing together the recorded call to make it sound like you approved of making a change to your service.

Once again, this practice was already a federal crime, it's just now easier for the FCC to enforce punishments on companies that employ the practice.

Previously, to help prevent slamming, the FCC started a third-party verification process to police the industry. Under these new guidelines today, any company found slamming its customers will be unable to use that third-party service for five years, which would be devastating to companies dependent on the practice.

However, the FCC also passed new guidelines that make it so this third-party verification system doesn't have to ask customers about each and every change they elected to make, instead only having to get general approval. One could see this lax new system being abused, but the FCC says it will make things easier and less confusing for the consumer.

NEXT: California Senate defies FCC ruling, passes its own Net Neutrality bill

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