AT&T Caught Overcharging Customers by Increasing Buried Fees Threefold to Make Nearly $1B

With all of the controversies surrounding AT&T’s treatment of customers, it’s a wonder it still has so many of them to abuse. A recent discovery by a research analyst showed how the carrier is now overcharging customers by tripling a fee that’s buried in their bill. This has allowed the company to make an extra $800 million in revenue without customers even noticing.

The buried fee is called “administrative fee” and it can be found way down a customer’s copy of their monthly bill. According to Walter Piecyk, a researcher at BTIG Research, AT&T has increased this fee threefold over the last six months.

What was supposed to be only $0.76 six months ago, became $1.99 at last count, which is charged to around 65 million customers. As a result, the total amount that the carrier gets through such a vague and unspecific fee is nearly $1 billion.

As for why AT&T might have decided to increase the fee to such an exorbitant level, Fortune notes that it might have something to do with its deal with Time Warner. The carrier did have to shell out $108 billion in cash and stocks to finalize the acquisition. It even had to assume some debt in the process.

One result of this arrangement is the reduced confidence that Wall Street has in the carrier. AT&T’s stock prices dropped by 16 percent at the time of this writing. The carrier did release a statement to the publication, however, which offers a different explanation as to why it increased the fee.

“This is a standard administrative fee across the wireless industry, which helps cover costs we incur for items like cell site maintenance and interconnection between carriers,” AT&T told Fortune.

Smelling blood in the water, T-Mobile CEO John Legere blasted AT&T over the news on Twitter. The Uncarrier boss pointed at this development to highlight the shortcomings of its competitor and the advantage of his own company’s offerings.