Verizon offers refunds for fraudulent SMS messages

10.03.2011
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.

, the suit names Jason Hope, Wayne DeStefano, three of their employees and their related companies, including Cylon LLC and Jawa.

Because some of the short message programs the defendants set up complied with Verizon's rules, Verizon says it is unable to identify which customers didn't know about the charges for the services. As a result if they were wrongly charged for the services.

Verizon describes a plan enacted by the defendants over more than a year to evade detection by Verizon for text message campaigns that hid the cost of the services from consumers. The operator first approached Cylon in 2009 when it discovered that Cylon wasn't complying with Verizon's terms for offering premium text services. Verizon suspended Cylon as a result, but Hope and DeStefano came up with ways around the suspension, the operator says.

For instance, the defendants began setting up new companies each time they leased a short code and activated a campaign so that the operator didn't know the campaign was affiliated with Hope and DeStefano, Verizon alleges.

Short codes are short phone numbers the users can text in order to sign up for premium services. The CTIA mobile trade group administers short codes so that they'll work across operators. The campaigns promised to send text messages to subscribers regarding news, recipes and movie times, among other topics.