Advocacy group says T-Mobile sales goals led to insurance fraud

CEO John Legere has built T-Mobile’s empire upon a mountain of unethical pressure tactics in the backrooms and show floors of its stores. It’s also padded by accounts and services siphoned into customers’ bills that no one asked for.

So claims Change to Win, an advocacy group for consumer and labor issues. And if there’s anything that is controvertible, it’s that the Un-carrier was the subject of the most complaints to the Federal Trade Commission in 2016.

Data requested under the Freedom of Information Act from the FTC shows that over the past three and a half years (that last bit marked the first half of 2016) T-Mobile consistently had the most consumer complaints out of the four major US carriers.

It had 21 complaints per million subscribers in 2013, then 29 in 2014. The number skyrocketed to 60 in 2015 and in the early part of this year alone, there were 95 complaints for every million subscriptions — going by the company’s numbers, that meant that over 6,400 complaints were lodged, or, a whopping 18 percent of the 35,000 or so complaints put against the industry over the past three-years-plus.

When it comes to fraudulent enrollment claims, T-Mobile customers topped AT&T, Sprint and Verizon — between 2013 and 2016, there were 10.1 complaints per million subscribers. Compare that to AT&T’s 7.1, Sprint’s 5.9 and Verizon’s 5.0.

These claims cover many an add-on that came unwanted or not transparently offered to the customer like an extra line, bundled accessories, data plan upgrades or, most commonly, device insurance. According to an online poll of T-Mobile customers conducted by Change to Win, 36 percent of the sampled population of 2,200 reported such extraneous fees and about 56 percent of them said that they paid more per month than the rate Little Magenta advertised.

Pressure has been mounting for sales representatives to push insurance onto customers one overt way or a covert other. 83 percent of a pool of 500 sales reps serving stores in six states told CtW that they were under the gun by management to cram services and products not explicitly requested by the customer.

One of a handful of associates gave their account of what stringent and heavily-monitored hourly goals did to colleagues:

The fact that there is such extraordinary pressure makes it so you can’t do what’s ethically required. I will do the best possible job that I can do, but the fact that [T-Mobile’s managers] put me in a compromising position and do unethical things is stressful. There’s so much stress and internalized anguish because we can’t meet our goals. And we know we’re smart and capable, but are made to feel inadequate on a daily basis. That’s why we have people out on [off-time ensured by the Family Medical Leave Act] because of stress and such a high turnover in retail.

The JUMP! program that combined insurance with an early device upgrade scheme was a centerpiece for T-Mobile’s drive for growth, costing $9 or $12 a month. Several associates reported that they added JUMP! to newly-enrolled and unwitting customers to meet managers’ goals, then took the program off after a few days.

“No one says ‘I want to work at T-Mobile to do fraud. But a lot of reps do it because they want to keep their jobs and they want to get the pay they need. They aren’t bad or dishonest people, but there’s just a lot of pressure.”

All of these practices, CtW asserts, account for T-Mobile’s recent props in average revenue per user. Workers are petitioning Legere to address these issues. He has yet to publicly respond.

The nation’s third-largest network by subscriber base has faced its share of consumer controversy with claims against its “no-contract” offerings when it first began its Un-carrier campaign in 2013. Labor conditions have also been a worrisome, ongoing topic.

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About The Author
Jules Wang
Jules Wang is News Editor for Pocketnow and one of the hosts of the Pocketnow Weekly Podcast. He came onto the team in 2014 as an intern editing and producing videos and the podcast while he was studying journalism at Emerson College. He graduated the year after and entered into his current position at Pocketnow, full-time.