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Phone Customers Pay $2B Yearly In Bogus Fees

samzenpus posted more than 3 years ago | from the fine-print-on-the-fine-print dept.

Communications 220

Hugh Pickens writes writes "CNN reports that a one-year study by the Commerce, Science and Transportation Committee shows about $2 billion a year in 'mystery fees' show up on the landline phone bills of Americans. Known as cramming, the extra charges include:long distance service, subscriptions for Internet-related services, access to restricted websites, entertainment services with a 900 area code, collect calls, and club memberships. The Commerce Committee's report says phone companies receive a small fee — often just a dollar or two — for allowing charges from third-party vendors to appear on their bills but due to the large number of customers the charges eventually add up. Illinois Attorney General Lisa Madigan told the panel people are unaware their phone numbers can be charged almost like a credit card and her investigations indicate customers are not even getting services in return. 'My office has yet to see a legitimate third-party charge on a bill,' says Madigan, who added most customers don't detect the charges on their bills. Senator Jay Rockefeller says Congress needs to pass legislation to protect customers from unauthorized third-party charges on their phone bills because the telephone industry has failed to prevent the practice. 'It's pretty obvious at this point that voluntary guidelines aren't solving this problem,' says Rockefeller. 'It's time for us to take a new look at this problem and find a way to solve it once and for all.'"

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Who (-1)

Anonymous Coward | more than 3 years ago | (#36761084)

Wait who still has a landline? :)

How is this not theft (1)

ComaVN (325750) | more than 3 years ago | (#36761090)

How is this not theft, and why aren't people prosecuted for it using existing legislation?

Re:How is this not theft (2)

Dunbal (464142) | more than 3 years ago | (#36761112)

Not only theft - wire fraud.

Re:How is this not theft (0)

Anonymous Coward | more than 3 years ago | (#36761568)

Because the customers are just using their phone account as a credit card - these "mystery charges" are essentially just calling 900 numbers.

Re:How is this not theft (3, Informative)

ZombieBraintrust (1685608) | more than 3 years ago | (#36762720)

No. The customers are doing squat. These scammers just go through the phonebook at and add monthly fees to peoples bills. My parents buisness had fight with AT&T for 3 months because of these scams. They would get a fee taken off and the scammers would just add it back on. They had to watch there bill each month and call AT&T every month to get the fees dropped.

Re:How is this not theft (5, Insightful)

Sponge Bath (413667) | more than 3 years ago | (#36761748)

It is not theft because large corporations profit from it. At least that is the best explanation I can derive from observing the US justice system.

Mod parent up! (0)

Hatta (162192) | more than 3 years ago | (#36762032)

The parent post exhibits a keenly accurate understanding of the American legal system.

Re:How is this not theft (4, Informative)

Anonymous Coward | more than 3 years ago | (#36762074)

No, it's not theft because the last two times (2005 and 2010) legislation to stop it came up, key Republicans (like Boehner) were paid off by the phone companies to keep it from coming to the floor.

Now, if it had been PELOSI who quashed the bills during the brief time the Democrats held the Congress, then the Republicans would be screaming bloody murder. But they'd rather this sit quietly under the rug and be forgotten about, because it's their "rape the consumer" agenda running as usual.

Re:How is this not theft (4, Informative)

flappinbooger (574405) | more than 3 years ago | (#36762582)

I have had some experience with this, and what happens is there will be a phone call made to the customer, may times a business, (the mark, as it were) and they will ask something like "do you not want your phone number listing to not be not removed from the universal listing service?" or some such bogus question, the person says something either yes or no.

The theiving company then makes a record that the mark company has agreed to have the service, since they actually made contact with them, then they do whatever procedure is needed to add the 3rd party charges to the bill.

There is no law that says 3rd party charges are illegal as long as the "customer" actually "agrees" to the charge. Sometimes there are even recordings of the conversation. A fast talking call center employee usually gets a low paid phone answerer at the company, and they don't know about the scams, don't know to say no to anything. Sometimes even saying "no" really means "yes, start charging me" because of how they word the question.

Many times the people paying the bill aren't the owner, and they only look at the final amount.

It is possible to remove the charges by calling the 3rd party company and saying the person who they talked to didn't have authority to make the agreement, and sometimes you can even get a refund of much of the money back to the start of the charges being on the bill.

The key thing to realize is that it IS legal, it is 99.99999% bogus, everyone knows it (except most of the customers, apparently) and they let it continue. I heard that a while back there was a large amount of fines laid out on these 3rd party companies, sort of a gesture by the powers that be. Yet it continues.

Re:How is this not theft (1)

flappinbooger (574405) | more than 3 years ago | (#36762664)

Oh, another thing - if you call the number of the 3rd party charger, and talk with authority, and demand a full refund of all the charges, many times they will give you the refund - even send you a check.

Why? Because a) they make so much freakin money they don't care b) hardly anyone calls c) they don't want to get "in trouble" by not providing "good customer service" because they are trying real hard to stay JUST on the legal side of the line. JUST.

I heard of a company that had been paying for "web hosting service" $39.99 a month, every month, for YEARS. Thousands of dollars flushed down the toilet. They had no website, of course. IIRC they did get a partial refund once it was found out and the call made.

That's All? (2)

longbot (789962) | more than 3 years ago | (#36761092)

Does this seem lower than expected to anyone else, or is that just my own experience?

Re:That's All? (1, Funny)

w_dragon (1802458) | more than 3 years ago | (#36761556)

I was kinda thinking that half of that was probably me alone. I should ask them to give it back.

You can stop them (5, Informative)

Lumpy (12016) | more than 3 years ago | (#36761098)

You call the phone company and demand they block all third party charges. They will hem and haw about how your life will suck without them. also with that block all fee phone number exchanges... yes they can do that as well. I got further and block all international calling as well. If I want to talk to Gunther in Germany, I'll use Skype or a calling card that is massively cheaper.

Honestly they need to default to all this crap being blocked and you have to call to enable it.

Re:You can stop them (5, Insightful)

Dunbal (464142) | more than 3 years ago | (#36761128)

Honestly they need to default to all this crap being blocked and you have to call to enable it.

What, and miss out on $2B a year? Phone companies (like many other companies) know that many people are just too damned lazy to go over their bill every month. And of those who do check, there's a percentage who are too lazy to actually do anything about it. While it is absolutely wrong for them to do this, when did ethics ever win against profit?

Re:You can stop them (-1)

Anonymous Coward | more than 3 years ago | (#36761334)

You get a bill, every month with a list of charges. If you are to lazy to call in and dispute them, then that's YOUR fault. If you are to lazy to read the bill, then that is YOUR fault. Not the phone companies. And this is wrong? You realize that they are a for profit business, and not a charity right? They exist to make money. The ones who are in the wrong and the ones that are committing fraud. It's not the phone companies committing fraud, it's the companies placing bogus charges on peoples bills.

Re:You can stop them (1, Insightful)

Anonymous Coward | more than 3 years ago | (#36761380)

Are you retarded or something?

Re:You can stop them (1, Offtopic)

Dunbal (464142) | more than 3 years ago | (#36761492)

Every year slashdot moves a little closer to the trailer park.

Re:You can stop them (3, Insightful)

Amouth (879122) | more than 3 years ago | (#36761674)

when you have to have training to properly read your bill - there is a problem, and it isn't always the users in this case.

phone companies go out of their way to make the bill hard to read and understand, and to make bogus things look legit (at least in my experience)

Re:You can stop them (2)

stephathome (1862868) | more than 3 years ago | (#36762514)

I assume it's the same as when I worked for the phone company, more than 10 years ago, but the other hard part for a lot of customers was understanding that they had to call the company that put the charge on the bill to cancel it most times. Regular customer service phone company employees couldn't do it, although removing the charges wasn't a big deal so long as the dollar amount wasn't huge. It was amazing how long some of these charges could be put on before someone caught on, and then expected all of them to be removed, months later.

It really pays to review your bills every month. Very simple to do, and then you know what it should look like.

Re:You can stop them (2)

DoofusOfDeath (636671) | more than 3 years ago | (#36761378)

Agreed. They need their corporations disolved for having violated their charters.

Re:You can stop them (4, Insightful)

w_dragon (1802458) | more than 3 years ago | (#36761578)

Thing is, if it's just a buck or two per month it's really not worth my time to wait on hold for an hour to get it fixed. Especially since I'll have to wait, get escalated, wait again, get denied and ask for a supervisor, wait again, and then maybe get my $2 back. I can find better ways to get that money in that time.

Re:You can stop them (1)

Amouth (879122) | more than 3 years ago | (#36761658)

and when the charge is a single line item on a ~80 page phone bill even people who do review them miss them.. At work i had to put together a cheat sheet/lesson plan so that the book keeper could review our bill for correct charges. (what to look for where)..

it's crazy that they get away with this crap - but hey the government lets them because they pay the people who are in office.

its not a bribe - its business as usual.

Re:You can stop them (1)

Entrope (68843) | more than 3 years ago | (#36762120)

I call shenanigans. How many people get 80-page bills for their (home) land lines? My bill for a combined voice/data/television package (from the incumbent phone carrier) is about five pages long each month, and a lot of that is legally-required boilerplate notices and disclaimers. Half of the rest is formatting to make it easier to follow the content.

Re:You can stop them (0)

Anonymous Coward | more than 3 years ago | (#36762306)

I call shenanigans. How many people get 80-page bills for their (home) land lines? My bill for a combined voice/data/television package (from the incumbent phone carrier) is about five pages long each month, and a lot of that is legally-required boilerplate notices and disclaimers. Half of the rest is formatting to make it harder to follow the content.

FTFY

Re:You can stop them (1)

Amouth (879122) | more than 3 years ago | (#36762788)

you must not get detailed call logs - i get one line item per call both in and out..

make note that this problem does not apply to just "land lines" it applies to all phones .. they can do direct bills to a cell phone just as easy. (and yes my land line gets detailed call history in the bill.. it's amazing how many call/hangups there are during the day, and that bill is around 10 pages. (5 pages front and back)

by no means do they try to make it or format it to be easy to read for the average person.

Re:You can stop them (1)

Anrego (830717) | more than 3 years ago | (#36761162)

Same reason they don't prevent you from going over data caps. They _could_ just cut you off.. or send a notice, or warning, or something.. but why would it be in their interest to do so.

This probably requires legislation to happen.

Re:You can stop them (1)

Lumpy (12016) | more than 3 years ago | (#36761222)

It's based on the "honestly" of the company. and people need to have the balls to call them out. People need to publicall call companies DISHONEST when they do things like that.

Re:You can stop them (5, Insightful)

Anrego (830717) | more than 3 years ago | (#36761252)

People need to publicall call companies DISHONEST when they do things like that.

They do. All the time!

Problem is it changes nothing. A few lucky people can live without a phone (or a credit card, or internet, or whatever competition-limited utility you want to talk about) but most have little choice but to bend over and take it.

The president of my ISP could come to my house and piss on my shoes .. and I'd probably keep my subscription. They are the only provider .. and I kinda need internet to live.

Re:You can stop them (4, Funny)

trum4n (982031) | more than 3 years ago | (#36761420)

At lest kick him in the nuts while he's there!

Re:You can stop them (3, Informative)

Rob the Bold (788862) | more than 3 years ago | (#36761258)

You call the phone company and demand they block all third party charges. They will hem and haw about how your life will suck without them. also with that block all fee phone number exchanges... yes they can do that as well. I got further and block all international calling as well. If I want to talk to Gunther in Germany, I'll use Skype or a calling card that is massively cheaper.

Honestly they need to default to all this crap being blocked and you have to call to enable it.

You call the phone company and demand they block all third party charges. They will hem and haw about how your life will suck without them. also with that block all fee phone number exchanges... yes they can do that as well. I got further and block all international calling as well.

What he said.

To which I would add: tell your phone company that you won't pay any bogus 3rd party charges currently (or ever appearing) on the bill. You're happy to pay their part, but the check won't include the stuff that was crammed on. They'll threaten you that your phone could get cut off, but they won't really do it. Why would they give up $50 bucks a month just to collect 3 dollars for some other guy?

I worked for a while with a 3rd party collect call operator. The company had billing agreements with lots of local carriers. But when push came to shove, the carriers would tell us to go do our own dirty work collecting from the unwilling. They wouldn't go the mat for us even for legitimate charges that the customer disputed. [Don't worry, all you contracts-are-sacred guys, our little company was free to send its own bill in that case -- having the telco collect it was just a convenience, not the exclusive means of collecting the debt.]

NB The above technique won't work if it's the telco itself that crammed the charges on -- or if they've got a big enough stake in it. If it's their money the will come after it.

Re:You can stop them (0)

Anonymous Coward | more than 3 years ago | (#36761542)

Why would they give up $50 bucks a month just to collect 3 dollars for some other guy?

The same reason the IRS will send in the SWAP when you don't pay $0.50 from your 10'000$ taxes: Principles. If they accept it on one guy, a million more will do it. If they start to let you differenciate between different types of money-you-owe-them, they'll open pandora's box, and they know it!

Re:You can stop them (1)

ixidor (996844) | more than 3 years ago | (#36761954)

i hop you mean SWAT! if they send you their swap file .. hmmmm

Re:You can stop them (1)

Anonymous Coward | more than 3 years ago | (#36761866)

You CAN stop them! Get rid of your landline. I got so tired of finding and contesting extraneous charges on my landline bill that I just had it cancelled. I now have only a cell. In fact, my son and I both have a cell on a family plan for monthly charges less than what the landline cost.

BTW, I get a monthly letter from the phone company telling me that "my number is still available". Go figure!

Re:You can stop them (2)

BStroms (1875462) | more than 3 years ago | (#36762248)

I've never had a land line. The only reason I can see to keep them is wanting to hang on to a number everyone knows. Even then it's probably worth biting the bullet and getting rid of it. If you have a family and want a shared line that's always on, it's probably cheaper to add another number to your cell phone plan and just have a cell phone that stays at home 24/7.

Which They May Or May Not Do (1)

Greyfox (87712) | more than 3 years ago | (#36762494)

Mom did a story a few years back about a family that had blocked International calling and then the phone company just went ahead and unblocked it the next month. Apparently they did mention it in a tiny line item on the bill. So they don't notice this and their kid goes and downloads an "Internet Dialer" that dials an international number and racks up a $10,000 phone bill, which the phone company was planning on holding them to last I heard.

We need a law to make fraud illegal? (4, Insightful)

erroneus (253617) | more than 3 years ago | (#36761118)

Every time I turn around it seems like there's a new way to game the easy systems in place for every-day-modern-life. The credit game has no security -- it relies of trusting lots and lots of strangers with "secret numbers" and bits of information that, when used, is "you." The phone bills have no security either. And all the while, we see fraud over and over and over again with almost no punishment or pursuit of the perpetrators while the enablers of all of this persist in using the system because the benefits them are apparently outweighing the problems or them... not the problems for the customers, but for them... they don't care about the customers.

Re:We need a law to make fraud illegal? (5, Insightful)

Anrego (830717) | more than 3 years ago | (#36761226)

There are two critical problems at work here in my opinion:

The first is that "free market will decide" tends not to work on stuff with huge barriers for entry and almost universally required. A few lucky people can say "screw credit cards, I'm only going to use cash" or can live without a phone ... but most don't have the option. They have to pick one provider from the available options, all of which mostly offer the same "bend over" treatment. You need legislation for this kind of stuff.

The next is that a huge number of users prefer convenience over all else. Personally I think it should be an absolute hassle to use my credit card. It should involve one time passwords, independent transaction authorization, various identity checks, passwords, etc. Most users would balk at this however... they want to hand their plastic over and be on with their day.

Re:We need a law to make fraud illegal? (1)

tepples (727027) | more than 3 years ago | (#36761794)

"free market will decide" tends not to work on stuff with huge barriers for entry and almost universally required. [...] You need legislation for this kind of stuff.

Unless it was legislation that created the "huge barriers for entry" in the first place.

Re:We need a law to make fraud illegal? (1)

drooling-dog (189103) | more than 3 years ago | (#36761400)

If the financial services industry taught us anything, it's that fraud is perfectly legal (and even rewarded) if it's large enough...

Bogus charges (1)

Bolen (4896) | more than 3 years ago | (#36761140)

I had a weird charge for "Auctions eBay" show up out of the blue on my wireless bill. I've never used my phone for anything like that. Fortunately, I was able to have that removed with a simple call to my provider. Better still would be if it never happened.

If you or your parents have a land-line from AT&T, I suggest you check their bill. "Inside wiring" is another mostly useless charge. How often does wiring go bad?

Re:Bogus charges (1)

NJRoadfan (1254248) | more than 3 years ago | (#36761488)

Heck, how many are still paying a rental fee for a handset from the Ma Bell days?

Re:Bogus charges (1)

bzipitidoo (647217) | more than 3 years ago | (#36762666)

No rental fee for the phone, but AT&T still dings us $0.18 every month for touch tone.

Personally, I do not like any sort of wireless. Been looking at VoIP, but Internet is just not as reliable. So I hang on to the land line.

Re:Bogus charges (1)

stephathome (1862868) | more than 3 years ago | (#36762600)

It definitely does sometimes, but not so much that I'd get "inside wiring" personally, and I worked for the phone company for about a year more than 10 years ago. Got people calling to get that added to their bill often enough because they had just reported a problem that might involve their inside wiring. Some people would push it pretty hard. A few years after I left that job, had a case where my phone line was crossed with someone else's, and they tried to see me on inside wiring for that one. It was quite obviously an outside issue, so of course I had no interest in it.

Happened to My Parents (1)

Dog-Cow (21281) | more than 3 years ago | (#36761192)

This happened to my parents for several months with AT&T. Every month, my dad would have to call AT&T and have them remove the bogus charges. They insisted that it was impossible to block these charges. My response to my parents was that they should drop AT&T and get a VoIP line. We switched to a Comcast business account for cable and to voipo for phone service. Even with the business line, my parents were paying about $50 less per month, and have had zero billing issues.

(I've since left the house, so they downgraded to a residential account. They are saving even more now.)

Problem solved. (0)

Anonymous Coward | more than 3 years ago | (#36761198)

I have no phone bill anymore. They get nothing.

Fuck the phone companies. Can you get anymore scummy than them?

This is at the very least, fraud. More like theft (0)

Anonymous Coward | more than 3 years ago | (#36761200)

Corporations have person for various legal reasons (and none of them good imho) - so charge these "persons" with fraud and theft. Talk about double standards.
I really don't understand why you U.S. Citizens put up with the crap that you do. It boggles my mind.
Good luck with the Corporate Future guys, you need some serious changes or you are just screwed, plain and simple.

Landlines only? (1)

Aladrin (926209) | more than 3 years ago | (#36761208)

What about mobiles?

My dad was hit with a bunch (3-4) of $10/mo charges for 'flirting tips' and other garbage. He has -no- idea how he got on them. We didn't catch them quickly, and T-Mobile would only refund the last 3-4 months worth. I think he got on them by putting his phone number into sites online. Specifically, online dating sites. (But possibly porn. Why did you have to tell me that, dad?)

We ended up blocking all SMS on his phone to prevent it from happening again. At least, we think that will prevent it.

Re:Landlines only? (1)

Amouth (879122) | more than 3 years ago | (#36761726)

just wait.. next time they send a usage policy and/or terms of usage update to you - call back you will find that your "blocks" have been removed and you will need to re add them.

at least that is what AT&T does.. and considering they are buying T-Mobile i would expect the same to be happening.

How are they mysterious and undetected?? (1)

wvmarle (1070040) | more than 3 years ago | (#36761224)

OK disclaimer first: I'm not American.

So I may be getting this totally wrong.

First of all: why are this "mystery" charges?

If you make an international call, you know you're doing it, and you know you'll be billed for it.

If you receive a collect call, you're given the option to accept or refuse it (this is something I've never used myself; my sister used it a few times calling my parents from abroad where she had to use public phones), and I basically can not imagine this service to be used much.

If they charge you for Internet or club memberships you most likely subscribed to it - otherwise it's of course a fraud. And in any case you should be able to unsubscribe too.

So I don't understand how any of these charges are "mysterious" or even "illegitimate".

Secondly: what about this undetected part? How can this can go undetected on such a grand scale? Do people not get a specified phone bill, listing all charges separately? Do they not actually look at their phone bill to know what they're paying for before writing that cheque?

Unless things work much different in the USA than in (the rest of) the developed world this whole story doesn't sound very believable to me. It just raises too many questions.

Re:How are they mysterious and undetected?? (1)

cvtan (752695) | more than 3 years ago | (#36761288)

In my case, a $12.95 monthly charge just showed up on my phone bill (land line). There are so many odd items on the bill, it's hard to notice another one. The charge was from a place called CompuFix who I had never contacted and never heard of. Phone companies are required by law to allow third party charges even if they are bogus. They make money on things like this so they have no incentive to stop it. They would have continued to charge us $12.95 per month for services never received. We had to call the phone company and block all these kinds of charges. Of course, there is a charge for that...

Re:How are they mysterious and undetected?? (0)

Anonymous Coward | more than 3 years ago | (#36761472)

Of course, there is a charge for that...

Um, no there isn't. They aren't allowed to charge you for that.

Re:How are they mysterious and undetected?? (1)

cvtan (752695) | more than 3 years ago | (#36761864)

Sorry, there is a fee for blocking numbers.

Re:How are they mysterious and undetected?? (2)

wvmarle (1070040) | more than 3 years ago | (#36761546)

In my case, a $12.95 monthly charge just showed up on my phone bill (land line). There are so many odd items on the bill, it's hard to notice another one.

That amount is more than I pay for my two business fixed lines. Yes that's together. So that's a pretty big sum for a phone bill to appear.

Secondly, "so many odd charges"... you go through the bill once, and tick what you don't know what it is. And make a call to the phone company for explanation. That's what I do with my credit card bill. It's not that hard, it just requires you to care about your money. If you let such sums just stand, sorry to say, but you obviously don't care enough.

Re:How are they mysterious and undetected?? (1)

Amouth (879122) | more than 3 years ago | (#36761804)

In my case, a $12.95 monthly charge just showed up on my phone bill (land line). There are so many odd items on the bill, it's hard to notice another one.

That amount is more than I pay for my two business fixed lines. Yes that's together. So that's a pretty big sum for a phone bill to appear.

Secondly, "so many odd charges"... you go through the bill once, and tick what you don't know what it is. And make a call to the phone company for explanation. That's what I do with my credit card bill. It's not that hard, it just requires you to care about your money. If you let such sums just stand, sorry to say, but you obviously don't care enough.

sorry i don't know where you live - but around here the cheapest fixed POTS line is 31$ a month (local calling only).. and for something that is a frame based is >300$ a month for the local loop, cheapest monthly cell phone is ~35$ a month.. the bill in front of me is >80 pages long in a 5x8.5 size with ~8pt font on it.. it takes me ~2h to review that bill and i fully understand it.

flip over to your grandmother with her local loop line and long distance - maybe even dsl on that one bill it is still ~10 pages long and still in that 8pt font size (even though there is no need for it)

the telco's go out of their way to make the bills hard to understand. and in this confusion it allows them to exploit people for more money.

and it reallllllllllllly didn't help that the supreme court agreed that by agreeing to service you agree to waive your rights and settle any disputes through their own arbitration.

Re:How are they mysterious and undetected?? (1)

xaxa (988988) | more than 3 years ago | (#36762378)

Here [imgur.com] is a British landline phone + ADSL bill (though the ADSL isn't explicitly mentioned, it's part of the "Max Unlimited Plus Free Weekend Part II" package). It's complete, apart from the page containing two lines saying payment will be taken from my account automatically on a particular day unless I tell them not to, before some other day. The whole thing was four sides of A4.

It's a little old, as I don't have a phone line any more. We didn't use the phone much, so the call detail isn't very long, but it's still clear what each call is.
Usually, I could look at the summary by call type, see that nothing was over £1, and ignore the rest.

(I kept that one because of the £11 call to New Zealand. Up to 60 minute calls were free to NZ (and many other countries), but someone else in the student house made a 64 minute call. Normally, we were paying £14/month for phone + 8Mbit/s ADSL + unlimited UK landline calls + evening/weekend up-to-1hr international calls to western Europe, the US, NZ etc.)

Re:How are they mysterious and undetected?? (1)

cvtan (752695) | more than 3 years ago | (#36761922)

I obviously don't, but luckily my wife the accountant does care. The bogus charge was caught the first time it appeared. After being with this phone company for 40 years, you tend not to look at the bill too closely (I least I don't). Now they will get the evil eye every month.

Re:How are they mysterious and undetected?? (1)

Bolen (4896) | more than 3 years ago | (#36761292)

You don't know if you are making an international call if it is forwarded from a local/USA call. This happens all the time -- legitimately -- when calling an "800" number (US intra-country long distance) gets routed to a call center in India.

Re:How are they mysterious and undetected?? (1)

wvmarle (1070040) | more than 3 years ago | (#36761514)

In that case you are making a local or 800-number call... you're not making an IDD call... so you should not get any of those charges on your bill. So if you see international charges and you never made an international call (the few that call internationally regularly will know they do), it's a fraudulent charge. And those calls to India are probably routed over the Internet nowadays, and not over telephone lines.

Re:How are they mysterious and undetected?? (0)

Anonymous Coward | more than 3 years ago | (#36761800)

It is possible to "break out" of an 800-number call and have the rest of the call charged at a different rate (for example, when the service center offers to connect you instead of just giving you a number and having you dial another call). This does require the explicit consent of the caller though, so the usual "800 call is routed to a foreign country because brown people work for less" construction can not generate charges legally.

Re:How are they mysterious and undetected?? (1)

Attila Dimedici (1036002) | more than 3 years ago | (#36761308)

Because most people don't even look at the itemized portion of their bill, they just pay it. I have on a few occasions purchased a service online using my phone bill (it has been a few years, so I don't remember what). I did it because I did not have a credit card at the time. I have, also, had a few "mystery" charges turn up. When I called the telephone company and challenged them,they immediately took them off of my bill (and told me they would flag that vendor for abuse of the system). Of course, it does not help that there are several routine charges on the telephone bill that are hard to decipher. These are government mandated charges, or taxes, that appear on the bill in a manner that is hard to decipher because the law implementing them requires that (the legislators don't want people to realize that it's thier fault those charges are there).

Re:How are they mysterious and undetected?? (3, Insightful)

jank1887 (815982) | more than 3 years ago | (#36761450)

Most people don't look at their bills at all. Why? Paperless billing. My bank, credit card company, utility company, mobile, internet, TV and phone company all want me to switch to paperless billing. A few credit cards actually gave you a credit for going paperless. I know from personal experience that when I get the email notice of a new statement, I peek at the dollar value. if it looks about right I rarely click through to the actual statement. I guarantee you a lot of people don't even go this far.

Re:How are they mysterious and undetected?? (2)

Attila Dimedici (1036002) | more than 3 years ago | (#36761690)

Even with itemized paper bills, many people don't look at what they are being billed for. Of course, if you don't look at the itemized portion of the bill, don't complain when mystery charges turn up. Even without anyone doing anything evil, incorrect charges will occasionally turn up because someone made a data entry error.
I understand why you do what you do. I know approximately what each of my bills should be and if it is close to that I just glance over the itemized portion to make sure there isn't some new category of charge. I had one recurring charge on a cell phone bill get by for two or three months because it was less than two dollars because of that. Then my wife sent an unusual amount of text messages one month and my bill was high, so I looked at the details. The bill was high for legitmate reasons, but I caught the invalid charge (now I look at my cell phone bill a little closer each month).

Re:How are they mysterious and undetected?? (3, Interesting)

I'm not really here (1304615) | more than 3 years ago | (#36762280)

On top of paperless billing is "automatic payments" for your "convenience" (it's really for their convenience). So, mystery charges are added to a bill, you get an email with your itemized bill telling you "thank you for your payment" and good luck trying to get the company to refund that money.

Re:How are they mysterious and undetected?? (2, Informative)

Anonymous Coward | more than 3 years ago | (#36761342)

US landlines aren't a simple billing exercise. First you need a local carrier, this is say $30/month for "free local calls". Then you need a national carriers (could be the same company), this requires a monthly subscription too. Then you need, yes, you guessed it, an international carrier. There's a default to pick up the national and internationals, but the rates can be very high. Miss dial and that unconnected call can cost $4. Once you navigate this setup you get banged with umpteen levels of taxes and fees, which never seem to be the same month to month.

Things may have improved over the last few years, we gave up with land lines and use vonage's $25/month service (uses internet for connections but acts as as real phone system). This settled our national and international costs (free) for a while, but then the patent mess started and the FCC decided to stick its oar in. We now pay about $34/month for the $25/month service thanks to taxes and fees. Which is a hell of a lot better than regular phone companies (for us).

Re:How are they mysterious and undetected?? (2)

jank1887 (815982) | more than 3 years ago | (#36761390)

FTFA:
"When third-party vendors are contacted they claim the charges were authorized by customers and they often say they have audio recordings of the customer giving the OK, Madigan said...However, when her office obtained audio recordings, the voices turned out not to belong to the consumers who were billed, she said. "
"Eppley said she called the third-party company and was told Eppley's company had OK'd the charges and there was an audio recording to back that up. Eppley asked to hear it but the company never provided the audio recording."

sounds like straight out fraud. When you're only stealing $5, but do it a million times, it's easy to avoid legal ramifications as people see you as a nuisance, but not worth legal hassle.

Re:How are they mysterious and undetected?? (0)

Anonymous Coward | more than 3 years ago | (#36761404)

A local church & school allowed me to work with their large phone bill to see if they could lower it.

There were 2 or 3 crammed charges from companies that setup supposed websites for them, unsolicited and unwanted. I think they used some publicly available information to say that a certain invividual had approved it, when they had not done that.

I was able to get those charges removed and get a credit for some of the past charges. In this case, Verizon was very helpful in dealing with this

Re:How are they mysterious and undetected?? (0)

Anonymous Coward | more than 3 years ago | (#36761460)

At some point, phone companies started to think of themselves as payment processors. As far as business ideas go, that was a relatively sane one: The phone companies already have billing departments which are in regular contact with almost every household, they already itemize many small charges, they have established collection procedures, etc.

So they offered to process payments for other services than just establishing connections. At first, they used special numbers for that and the service and fee was still attached to a phone call, but nowadays you can basically use the phone company like a credit card company. It's still mostly used for phone-related "services", but since neither you nor the phone company can tie the charges to a number of call minutes, there's very little control over which charges are justified and which are simply bogus.

If you've ever heard of ring tone subscriptions, that is a very prominent example of charges bordering on fraud.

Re:How are they mysterious and undetected?? (4, Interesting)

BZ (40346) | more than 3 years ago | (#36761532)

1) This whole article is in fact about the fact that it's a fraud. That's what makes them "mysterious" and "illegitimate": they're bills for services that were never provided.

2) A typical US phone bill that does not have any of these charges on it (so just a normal bill) has a dozen or more line items with names designed to be as obscure as possible. Not only that, but in many cases these change from month to month (both the total bill amount and the exact itemization). As a result, it's actually easy to miss a $1 charge that shouldn't be there unless you're _very_ carefully reading the bill every month. Which most people don't.

3) For reasons that are beyond me, many people have their phone bills set up to auto-pay (basically have the phone company just withdraw the money from the user's bank account). So in that case there is no cheque being written. The payment just happens; you get sent a bill (or an e-mail that you can look at the bill online, if the phone company's incessant attempts to get you to go paperless succeeded).

So the deck is stacked against people noticing the problem. If they _do_ notice it, they have to decide whether they want to spend several hours on the phone trying to get rid of the charge or just pay it and move on. I bet in many cases people do the latter.

Re:How are they mysterious and undetected?? (1)

ledow (319597) | more than 3 years ago | (#36761540)

In a country that lets telcos CHARGE the receiver for receiving every SMS (solicited or not), anything's possible. Hell, sometimes they charge the person for receiving a phone call as well, even if it's an ordinary, domestic phone call and they never asked to be rung.

The US, collectively, are a bunch of people who do what corporations tell them to.

USA = Russia (-1)

Anonymous Coward | more than 3 years ago | (#36761244)

If not worse.

Re:USA = Russia (0)

Anonymous Coward | more than 3 years ago | (#36761814)

Having spent some time in Russia in the past year, I'm going to call you full of crap.

Uh, solve the problem? Of Capitalism? (1, Insightful)

geekmux (1040042) | more than 3 years ago | (#36761322)

"...It's time for us to take a new look at this problem and find a way to solve it once and for all."

Uh, you want to solve the problem of effective capitalism (a.k.a. greed and corruption) "once and for all"? Uhhh, yeah...good luck with that shit.

And asking Congress to step in? Congress should probably pick up a mirror first and wipe that kettle black off their face. I guarantee the average American is far more concerned with the trillions wasted by our Government and Congress than they are about an extra $10 on the phone bill.

Oh, and let's not forget about this. We're so focused on telcos and yet here we are, 20+ years later, and still cannot seem to order individual cable channels, and instead are forced (i.e. "crammed") into bundled packages and services. Let's not be ignorant and think this is a "new" problem, or one revolving around only telco providers. Everyone does it, it's all about the verbiage (fee vs. package deal)

Re:Uh, solve the problem? Of Capitalism? (0)

Anonymous Coward | more than 3 years ago | (#36761606)

Capitalism != Fraud.

Capitalism has to do with revenue being steered through the economy by voluntary transactions between buyers and sellers instead of forced revenue diversion by an authoritative body. You can still regulate what is lawful for a business to do under capitalism.

What happens when everyone decries capitalism and gives government control of the economy? We end up rewarding failure and funding every special interest and wasteful project politicians can dream up. Believe me, corruption is much easier to deal with in the private sector than in government.

Re:Uh, solve the problem? Of Capitalism? (1)

geekmux (1040042) | more than 3 years ago | (#36761924)

Capitalism != Fraud.

Capitalism has to do with revenue being steered through the economy by voluntary transactions between buyers and sellers instead of forced revenue diversion by an authoritative body. You can still regulate what is lawful for a business to do under capitalism.

What happens when everyone decries capitalism and gives government control of the economy? We end up rewarding failure and funding every special interest and wasteful project politicians can dream up. Believe me, corruption is much easier to deal with in the private sector than in government.

What makes you think various governments aren't already in control of the economy? Please. And "voluntary transactions" vs. "forced revenue"? Two sides of the same coin, just depends on what side you're looking at. One persons (forced) taxes is another organizations (voluntary) revenue stream.

And I'm supposed to believe this? I've got one word for you on that shit.

Bailout.

'Nuff said.

Separate the extra charges (2)

Mark4ST (249650) | more than 3 years ago | (#36761348)

Call your phone company and ask them to separate the extra charges from your phone bill. That way, the (perhaps) evil company will have to bill you independently of your phone bill. Often, they won't bother because they now know that you're the kind of person that doesn't mindlessly pay some mystery charge on your phone bill. I did this when I received a huge and clearly exploitative charge for receiving a collect call. This was several months ago and I have yet to hear back from the company that now has to send me a bill independently of the phone company.

But, but... (1)

smooth wombat (796938) | more than 3 years ago | (#36761426)

I was told free markets solve everything. That you don't need government regulation to police corporations because people will simply stop doing business with them if they don't get the service/product they want.

I can't imagine that corporations would put profit over customer service. This must be a mistake.

Freemarket Relies on Smart Consumers (0)

Anonymous Coward | more than 3 years ago | (#36761906)

Free Market does solve everything. I fail to see the problem here. When I check my bill every month to see what I'm paying for in the free-market system, I occasionally see billing errors. Intentional or unintentional, I contact my telco company (or any other for that matter) and ask about the charge. they inform me of what the bill indicates and if I have not received the service, I request that they remove it from my bill. I've never had a situation where after asking about a service I have not received I've still had to pay for it. As with anything in a "free society" doesn't mean "bereft of personal responsibility.

And before you tell me that the government will fix this, it takes more time to get my money back from the IRS each year than it has ever taken to correct a phone bill. and an order of magnitude more money.

You can't even call to complain (1)

cvtan (752695) | more than 3 years ago | (#36761498)

Compufix put a $12.95 charge on my phone bill even though I never used their "services". I had these charges blocked from my phone by calling the phone company. Blocking numbers creates an additional charge. Suppose I want to call Compufix to complain to them. They will want to know my name and phone number which I don't want bogus companies to have. Arrgh! I used to think evildoers would be caught and prosecuted, but I no longer think that.

There already is a law (0)

Anonymous Coward | more than 3 years ago | (#36761520)

I am constantly seeing stories proposing a law to deal with a situation, but in most cases there already is a law, or a court ruling.

In this case. If you charge somebody for a service, but fail to provide the service, you are selling a fraud.

For anything else, it could be argued to be a breach of contract on the part of the phone carrier. If you did not agree to those services and parties, then they hould not be charging them to you.

Restricted websites? (1)

rebelwarlock (1319465) | more than 3 years ago | (#36761534)

Wait, the phone company gets to decide what sites you can and can't visit? What exactly does that mean? I haven't lived in the US since I was six years old, so I don't really know much about your ISP laws.

Re:Restricted websites? (1)

I'm not really here (1304615) | more than 3 years ago | (#36762356)

Restricted websites = pay for access (paywall) websites, such as porn, technical forums, some newspaper websites, etc.

Don't just hate the telcos (4, Interesting)

kmdrtako (1971832) | more than 3 years ago | (#36761544)

But I suppose Comcast is, for all practical purposes, a telco too.

I buy broadband only from Comcast, and at a discount too from a reseller.

One month my bill doubled -- they started charging me for CableTV. Call them up, ask them why CableTV is on the bill. Wait for them to look up my records, then the lie that "someone at your address authorized the add on." I tell them "nope, I'm the only one at this address with the authority to do that, and I did not, so take it off, I'm not using it, I'm not paying for it." Next lie was "oh, we'll send someone out, you'll have to be at home for the service call." My response: "How did it get added without an installer coming out? You didn't need someone here to add it, you don't need anyone here to delete it."

My wife and kids are finally trained too. Verizon sales droid walking the neighborhood rings the doorbell when I'm not home, tries to sell my wife or kids, I forget who, on FIOS. Nope, they told the rep, you block port 80. The sales droid had no idea what that meant.

Re:Don't just hate the telcos (0)

Anonymous Coward | more than 3 years ago | (#36762106)

As much as I think Comcast's practices are unethical, wasn't that an untruth you told about being the only one at your address? Your next paragraph mentions your wife and kids which you imply live at the same address.

Re:Don't just hate the telcos (1)

Sefi915 (580027) | more than 3 years ago | (#36762296)

You're not reading the whole comment.

He said "I'm the only one at this address with the authority to do that". He didn't say he was the only person there.

I do the same thing with my "household" - the house and all the bills are in my name, and if any telemarketers call, whomever answers the phone (if they want to, we do screen calls) they are instructed to answer "put it in writing, or give me a number and call reference number so the homeowner can call you back."

Re:Don't just hate the telcos (0)

Anonymous Coward | more than 3 years ago | (#36762190)

My wife and kids are finally trained too. Verizon sales droid walking the neighborhood rings the doorbell when I'm not home, tries to sell my wife or kids, I forget who, on FIOS. Nope, they told the rep, you block port 80. The sales droid had no idea what that meant.

Block port 80 how? I just tested my home linux web server from work and I can see it fine. Is this a specific physical area of their network or service?

Self regulation (1)

MM-tng (585125) | more than 3 years ago | (#36761584)

What self regulation does not work. This comes as a big surprise to me.

Scary quote (1)

kmac06 (608921) | more than 3 years ago | (#36761598)

Wow, talk about a terrifying thing for a prominent senator to say:

It's time for us to take a new look at this problem and find a way to solve it once and for all.

pbx hackings way worse (1)

Charliemopps (1157495) | more than 3 years ago | (#36761670)

That's nothing... most companies are so inept they never change their PBXs default password. Someone logs in over the weekend and starts routing calls to Europe all weekend. I've seen bills over $100k, it happens EVERY weekend and nothing can be done to refund the money. It's great when the CEO finally gets involved all calls the phone company complaining and they get to tell him "The admin password for your PBX was: 1111" and then he gets to go off an fire people.

Re:pbx hackings way worse (1)

sgt scrub (869860) | more than 3 years ago | (#36762070)

"The admin password for your PBX was: 1111" and then he gets to go off an fire people.

And the new guy doesn't know the password so he doesn't change it either.

the other side (2, Informative)

Anonymous Coward | more than 3 years ago | (#36761888)

Got family that works for a big phone company. Not a fan of the company mind you. Just wanted to give a shot at telling you what they told me about this whole mess.

Under the telecom act of 1996, the big phone companies at least, ATT, the 2 others, they're kinda between a rock and a hard place. The law requires that if some of these little piddly shit regional guys give them a signed LOA saying the customer wants a service, the phone company is REQUIRED BY LAW to push the billing through. Further, they are FORBIDDEN BY LAW to call and ask you if that's really your signature and if you really want this to go through.

Now they are required to do basic due diligence on the companies doing this. They have to make sure they're at least in appearance on the up and up. And if they get crap tons of people complaining about it they can eventually tell said company to take a hike, but it isn't instantaneous.

Anyways, the point is this isn't... entirely the big telecoms fucking you over. It's some shitty laws they helped write forcing them into a stupid position. So... don't just sit around and say we need to boycott them or some shit, push for the law to be changed.

Hmm...no problems here (1)

HikingStick (878216) | more than 3 years ago | (#36761946)

I've had no problems with our current telco, though it might have more to do with the services we do (don't) use than anything else.

I have been with TDS for five of more years now. We review every bill and have not found a single unauthorized charge. Prior to that, we were with Qwest for around 10 years. During that time, I remember finding one or two unauthorized charges, but they were quickly removed when I called in.

With our current telco, TDS, our bill does not vary from month to month. We have an unlimited local calling pack and our DSL service. We do not have a long distance carrier. No long distance calls may be made directly from our number. We requested the block when we established our service because we either used calling cards for long distance (at a little over one cent per minute), or our cell phones (no distinction between local/long distance calls). Because of that, our bill remains the same every month. If the bill ever is different, we can see it immediately. So, the two times we've used 4-1-1 service from the house were easy to spot, as was the change in the billing amount when we upgraded our DSL service (a price drop!).

I'm guessing that it is much easier to "cram" charges on accounts that have long distance services and limited call packages, since consumers expect that their monthly bills will vary. So long as the charges don't push the bill beyond where it usually falls, most people likely just pay up and wait for the next one.

Direct Withdraw (2)

sgt scrub (869860) | more than 3 years ago | (#36762030)

I blame direct withdraw for people not noticing it. Verizon tagged an addition $6 on my first bill for not allowing them to take money directly from my account. It is in the fine print. Needless to say I told them to go fuck themselves and nix'd the account. Every bill I pay gets looked at while I write the check so I notice everything and have a solid paper trial of my own. Unfortunately, more corporations are pushing this. IMHO so they are protected from the pissed off customer that refuses to pay the extra month and mysterious extra charges on the last bill after telling them to fuck off.

Right (1)

U8MyData (1281010) | more than 3 years ago | (#36762134)

They know exactly what they are doing. It's like throttling internet access. I am now living in an area outside conventional broadband. All I have is my verizon android. I have already discovered that my occasional video watching (news sites, youtube, etc) and my mild surfing habits are too much for my 2 GB tethering service. Sure, I could go up to 5 GB but that would add another $30. I think if I call and complain I would be labled a bandwidth abuser and told to go to... Really I don't abuse the internet, I'm just a systems pro and use it more than grandma. It's all about money, forget service outside trying to take customers away from the competitors.

Long Distance isn't bogus, what's bogus is... (1)

sys_mast (452486) | more than 3 years ago | (#36762240)

Long Distance isn't bogus, at least there was a time when it had a purpose, what's bogus is a fee NOT to have long distance. That's right, there is a charge NOT to be able to use your phone. This happened to me a few years back, I think it was SBC, now re-branded to ATT. I ordered a 2nd line for modem line, didn't have a need to be able to make a long distance call on that line, I'd be happy with "this call can't be completed" for anything non-local. They told me the charge was 3$ a month, NOT to be able to make a call. Despite my pressing for a while, and talking to a "supervisor" still had to pay. The response was, the FCC permits us to charge you this. Huh, really, give me a break. Of course they couldn't provide the FCC regulation number or rule that permitted the charge, so I call them liars. If by some chance the FCC does permit that, sounds like the Telecoms purchased some FCC regulations.

My solution was to sign up for an alternative long distance provider, one that didn't have the greatest $/min rate, BUT had zero monthly fee. In my case, zero use = zero bill from them. Worked great for the few years I wanted that line.

Re:Long Distance isn't bogus, what's bogus is... (1)

stephathome (1862868) | more than 3 years ago | (#36762760)

I had that exact situation with SBC once too. It was ridiculous.

On landlines? (0)

Anonymous Coward | more than 3 years ago | (#36762446)

Who still has a landline?? Certainly in Australia, you can get ADSL without actually subscribing to a phone service (all houses have physical lines courtesy of our monopoly, but you don't even have to pay line rental anymore AFAIK). Mobile, plus internet. Landlines are going the way of the floppy disk and the dinosaur.

On by default (0)

Anonymous Coward | more than 3 years ago | (#36762486)

In Canada, Shaw Cable blocks 900, Collect Calls, and third-party charges by default. And no, you can't turn them on, ever.

"Solve" It? (4, Funny)

Greyfox (87712) | more than 3 years ago | (#36762544)

I think I just figured out the solution to America's budget problem! We'll just cram $14 trillion onto next month's phone bill!

It'll go to the black hole otherwise known as... (1)

sargeUSMC (905860) | more than 3 years ago | (#36762592)

a Congressional committee. They'll talk, they'll call up witnesses, they'll point fingers, they'll make great speeches, and at the end of the day, like everything else that goes to committee, nothing will be done.

10+ Years of crap and now take a look? (0)

Anonymous Coward | more than 3 years ago | (#36762704)

Are you rubbing my knob? in 2011, now the Senate get's around to taking a look, only after the problem becomes an emergency.
What is there an FCC and FTC for? these agencies seem only to protect they spying and the money flowing from our pockets and communications to their filthy bank accounts. Just one of these phone crammer's has already committed three felonies. Three strikes, it ought to be life in prison. Or at least some broken legs or a burned down house. It would be cheaper to just shoot them.

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