The cell-phone providers falsely advertised the security of their systems, according to the Los Angeles District Attorney's Office. During an investigation, "cell phones purchased by undercover investigators were easily hacked into, enabling the voicemail to be changed at will," the district attorney said in a statement Thursday.
"Hacking into voicemail allowed messages to be changed or erased. Important information could be removed from the voicemail and phony information could be inserted," the district attorney said. "Imagine the havoc that could result."
Investigators were able to hack into voicemail accounts using something called a SpoofCard. SpoofCard's software lets people display any number they want on caller ID and has been used to access voicemail systems that do not require passwords such as those used by Cingular (now part of AT&T) and T-Mobile.
In a statement, T-Mobile said that customers who want to add password protection to their voicemail should call voicemail, then press the star key to interrupt the greeting, and then press 5 to be prompted to change their password.
"T-Mobile cooperated with the district attorney and is pleased to have reached resolution on the issue," the company said.
Two years ago, SpoofCard suspended Paris Hilton's account after gossip sheets linked her to the voicemail hacking of her celebrity rival, Lindsay Lohan. At the time, SpoofCard said it had suspended more than 50 customers for using the service to hack into voicemail accounts.
As part of Thursday's settlement, AT&T will pay US$59,300 in penalties; T-Mobile will pay $25,000. The case was heard in the Superior Court of the State of California for the County of Los Angeles.
In a separate civil action, SpoofCard's parent company TelTech Systems has agreed not to advertise its product as "legal in 50 states." It is not legal in California and some other states, the district attorney's office said. TelTech will also pay a $33,000 fine.
AT&T and TelTech did not immediately return calls seeking comment.