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AT&T Sued for Helping Criminals Make Easy Profits from Stolen Smartphones

Phillip Dampier May 1, 2012 AT&T, Consumer News, Video, Wireless Broadband No Comments

AT&T is facing a class action lawsuit from customers who allege the wireless giant is profiting handsomely from the stolen smartphone trade.

The suit, filed in California, claims AT&T makes customers purchase new cell phones to replace stolen ones, while allowing the thieves to sell phones to buyers who can walk into any AT&T store and reactivate them with a new SIM card, helpfully supplied by AT&T.

In effect, the lawsuit argues, AT&T is earning new revenue from victims forced to purchase a new phone as well as from the buyers of stolen phones who reactivate as new paying AT&T customers.

A Salt Lake City television station couldn’t believe AT&T was looking the other way when dealing with the pervasive problem of cell phone theft, so they sent reporters undercover with a deactivated iPhone that was reported stolen, and found AT&T employees ready and willing to reactivate the dead phone.

“All you would have to do is pay for the plan, said the unnamed AT&T agent. “We’ll set up your account with your ID and then put the new SIM card in there and put money on it.”

Those victimized by smartphone theft found AT&T agents less helpful, as KTVX reports:

At a second store I tell an agent “I think my phone has been stolen.” Unlike the claims in the lawsuit, this agent at a second store tells me he can suspend the service, but there’s no way to shut the phone down.

The agent said, “If they tried to activate it, we don’t have a way to flag serial numbers on the phone unfortunately.”

So the thief has an activated phone and the victim is left buying a new one for several hundred bucks.

AT&T claims the suit is without merit.  The company also claims it is working with other cell phone providers and Sen. Chuck Schumer (D-NY), to establish a new database of stolen cell phones.  When a smartphone is reported stolen, the forthcoming policy would guarantee the phone could not be reactivated with any participating carrier.

[flv width=”480″ height=”380″]http://www.phillipdampier.com/video/KTVX Salt Lake City Class action lawsuit claims ATT helps cell phones thieves for profit 4-30-12.mp4[/flv]

KTVX reporters go undercover and visit a few Salt Lake City AT&T stores to learn if the phone company is aiding and abetting smartphone thieves.  (2 minutes)

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