VANCOUVER (NEWS1130) – Canada’s Competition Bureau is suing the country’s big three wireless providers, accusing them of allowing customers to be mislead when it comes to “premium texting services.”

After a five-month investigation, the bureau wants Bell, Telus, Rogers (the parent company of News1130), and the Canadian Wireless Telecommunications Association (CWTA) to pay $31 million in penalties and give customers full refunds.

The bureau claims the companies allowed people to download premium-rate digital content like apps, texts, trivia questions and ringtones from third-party advertisers believing they were free of charge, but were not.

It also claims the three companies pocketed a share of the money collected and they, along with the CWTA, led customers to believe there were safeguards in place to stop unauthorized charges.

“Our investigation revealed that consumers were under the false impression that certain texts and apps were free,” says Melanie Aitken, Commissioner of Competition, in a statement. “Unfortunately, in far too many cases, consumers only became aware of unexpected and unauthorized charges on their mobile phone bills.”

The bureau wants full refunds for customers, and for each company to pay $10 million, along with $1 million from the CWTA.

It’s also seeking a halt to any representations that do not clearly outline the price and terms for premium-rate digital content and a notice from the three telecoms and the CWTA telling people about the terms and conditions of any order issued against them.

Bruce Cran with the Consumers Association of Canada applauds the lawsuit by the bureau but says people should not expect a refund anytime soon.

“The name of the game, quite often, when you’re talking about amounts of money like this appears to be, is such that defenders of the issue will probably want to delay paying it as long as they can,” Cran says.  

“We believe this is a very serious effort on the part of the Competition Bureau, but like all things in Canada we’re very slow with legal issues.”

Shawn Hall with Telus says they don’t control the ads by third party premium text message companies.

“We actually looked at cancelling the services altogether a few years ago,” he says.  “But that would have meant things like text-to-donate campaigns, voting for TV programs like, say, Canadian Idol or So You Think You Can Dance, paying for parking, would have been lost.”

“We have no control over what other companies say in their advertising and nor, frankly, would you want us to,” says Hall.

He says the industry approached the Competition Bureau more than a year ago for help to deal with questionable third party advertisers but he claims they were ignored.

Meanwhile, the CWTA is rejecting the Competition Bureau’s claims, arguing its actions could “disrupt the text message services, such as severe weather alerts, charitable donations, flight status updates or sports scores, on which millions of Canadian consumers depend.”

“Equally as alarming, the Bureau’s demands could significantly slow down – or even reverse – the deployment of e-commerce in Canada,” reads the statement.