FEDERAL JUDGE HALTS FRAUDULENT BILLING SCHEME

FEDERAL JUDGE HALTS FRAUDULENT BILLING SCHEME

Publication: US Fed News Service, Including US State News
Date: Wednesday, March 15 2006

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The Federal Trade Commission issued the following press release:

At the request of the Federal Trade Commission, a federal judge has halted a massive fraudulent billing scheme that has collected more than $25 million in bogus collect call charges from hundreds of thousands of consumers. The FTC charged three companies and their principals with deceptive and unfair billing practices for "cramming"

- the unauthorized billing of charges on phone bills - since at least January 2004.

"Charging consumers for bogus collect calls is stealing," said Lydia Parnes, Director of the FTC's Bureau of Consumer Protection." The Federal Trade Commission will not tolerate crooks who cram unauthorized charges onto phone bills."

The FTC's complaint alleges that, in many instances, the defendants initiated phony collect call charges, such as calls to telephone lines that were dedicated to computers and fax machines, and to phones where no one was present. In addition, some consumers' caller ID logs had no record of collect calls for which they were billed.

The FTC charged the defendants with violating Section 5 of the FTC Act by representing that consumers owed money they did not owe, and by causing consumers to be billed for collect phone calls they neither received nor authorized. According to the FTC's complaint, the defendants claimed that they submitted charges for billing on consumers'bills on behalf of long distance service providers, although the defendants have few, if any, long distance carriers as clients. The defendants' charges typically were buried on the last page of consumers'phone bills, with each charge typically in the range of $5 to $8.

On February 27, Senior Judge Kenneth Ryskamp ordered an ex parte temporary restraining order freezing the assets of Nationwide Communications Inc., Access One Communications Inc., Network One Services Inc., and their principals, Willoughby Farr, Mary Lou Farr, Yaret Garcia, Erika Riaboukha, and Qaadir Kaid. The order appointed a temporary receiver over them and banned them from engaging in unauthorized billing.

On March 8, the court found that the defendants engaged in the widespread unauthorized billing of collect calls in violation of Section 5 of the FTC Act and entered a preliminary injunction order prohibiting them from billing or submitting any charge for billing on a consumer's telephone bill. The order continued the asset freeze over them and appointed a permanent receiver over Nationwide Communications, Access One Communications, Network One Services, and certain affiliated entities. The FTC ultimately seeks to permanently bar the defendants from further violations, make them forfeit their ill-gotten gains, and make them pay restitution to consumers. The Commission approved the filing of the complaint in U.S. District Court for the Southern District of Florida by a 5-0 vote.

NOTE: The Commission authorizes the filing of a complaint when it has 'reason to believe' that the law has been or is being violated, and it appears to the Commission that a proceeding is in the public interest. The complaint is not a finding or ruling that the defendant has actually violated the law. The case will be decided by the court.

Copies (see at http://www.ftc.gov/os/2006/03/index.htm#15 )of the complaint are available from the FTC's Web site at http://www.ftc.gov and from the FTC's Consumer Response Center, Room 130,

600 Pennsylvania Avenue, N.W., Washington, D.C. 20580

. The FTC works for the consumer to prevent fraudulent, deceptive, and unfair business practices in the marketplace and to provide information on 150 consumer topics, call toll-free, 1-877-FTC-HELP (1-877-382-4357), or use the complaint form at http://www.ftc.gov. The FTC enters Internet, telemarketing, identity theft, and other fraud-related complaints into Consumer Sentinel, a secure, online database help consumers spot, stop, and avoid them. To file a complaint in English or Spanish (bilingual counselors are available to take complaints), or to get free information on any of available to hundreds of civil and criminal law enforcement agencies in the U.S. and abroad.

Federal Trade Commission, Plaintiff, vs. Nationwide Connections, Inc., Access One Communications, Inc., Network One Services, Inc. Willoughby Farr, Mary Lou Farr, Yaret Garcia, Erika Riaboukha, Qaadir Kaid, Defendants; .(http://www.ftc.gov/os/caselist/0523141/0523141.htm) United States District Court Southern District of Florida Civil Action No.: 06-80180; FTC File No.: 052 3141

CONSUMER INFORMATION:

What To Do If You Get Unauthorized Charges On Your Phone Bill(http://www.ftc.gov/bcp/conline/pubs/services/cramming.htm) Contact: Mitch Katz, 202/326-2161; Frank Dorman, 202/326-2674; Laura M. Kim, Attorney, 202/326-3734.

Mitch Katz, 202/326-2161; Frank Dorman, 202/326-2674; Laura M. Kim, Attorney, 202/326-3734.

Third-Party Service Fees Sneaking Onto Wireless Bills

Third-Party Service Fees Sneaking Onto Wireless Bills

March 10,
OPTING TO HAVE your daily horoscope sent via text message may help you prepare for the upcoming day, but it won't prepare you for all of the extra charges the service might inflict on your cellphone bill. Increasingly, consumers are discovering that all of those fun cellphone extras such as ringtones, games and entertaining text messages are resulting in some nasty charges from companies other than their cellphone provider.
"Most people have no idea that their cellphone provider can even act as a billing service for another company," says Bob Sullivan, author of "Gotcha Capitalism." What's worse: No credit card is needed. The only thing these so-called "premium content" providers need is your cellphone number to start billing. It also doesn't help that third-party charges are typically listed as vague "direct bill charges," "downloadable content" or "premium messages" on your wireless bill with no company name or specifics. "It's not like your bill says '$20 for ringtones,'" gripes Sullivan.
One common practice that catches consumers unaware is when a single purchase of, say, a ringtone or game, (unknowingly) triggers a monthly subscription or other additional charges, says Kent German, a senior editor at electronics review site CNET.com¹. The Florida Attorney General's office filed a lawsuit² in November against Buongiorno, a European digital mobile entertainment company, alleging that users who followed online ads for free ringtones were later socked with a $9.99 monthly subscription. (The suit is ongoing; Buongiorno has said it plans to defend its practices.)
Wireless service providers are also being taken to task. In early March, AT&T Mobility (formerly Cingular Wireless) settled³ out of court with the Florida Attorney General's CyberFraud Task Force, agreeing to reimburse thousands of its Florida customers who were billed by third-party companies for ringtones, games and other services that were advertised as free. The restitution is expected to surpass $10 million, says an AT&T spokesman.
Here's how to avoid getting sucked into third-party charges, and what to do should an unauthorized charge show up on your bill:

Avoiding Fees

Seek confirmation
The Mobile Marketing Association requires premium content providers to offer so-called double opt-in — meaning the customer must request the service and then confirm their interest again before they can be charged anything. You might think that downloading that new Tetris game, for example, won't result in any extra charges. However, if you receive an "Are you sure?" message before the transaction is complete it's highly likely that a charge above and beyond your wireless service provider's usual text message or web-usage fee is forthcoming, says Edgar Dworsky, founder of Consumer World⁴, a consumer advocate. Responding "no" should be enough to cancel a pending charge — although you won't get to download that game you want, either.

Pay with plastic
If you simply have to have season six "American Idol" winner Jordin Sparks's single "No Air" as your new ringtone, buy it from a company that lets you pay with a credit card such as RingToneJukeBox.com. Opting to have third-party charges billed directly to your credit card gives you added protection such as the right to dispute the amount and nature of an unwanted charge⁵.
Initiate carrier protections
"None of the providers really like these third-party companies because they have to deal with the customer service headache," says Joe Farren, a spokesman for trade group CTIA-The Wireless Association. Ask your provider what options it offers to keep such charges off your bill. In January, Verizon began allowing consumers to block premium SMS content providers from sending or subscribing them to content. AT&T offers controls that allow parents to keep their child from using a wireless phone to purchase any premium content, including ringtones, games and graphics.

Handling Fees

Monitor your bill
"You have to scrutinize your bill every single month," says Dworsky. You'll have an easier time removing unauthorized charges and getting reimbursed if you catch them right away, rather than a few months down the line. If you're worried about getting hit with unexpected charges, you might also opt to set up automatic bill pay⁶ through your bank rather than allow your cellphone provider to dip into your checking account each month. That way, you can dictate that only a set amount is taken out of your account so a bill padded with unwanted third-party charges won't go through.

Alert your provider
Your cellphone provider has no way of knowing you didn't agree to be billed until you call a charge into question or complain, says Sullivan. Most wireless service providers allow you to cancel a disputed charge and block future ones. Some will even reimburse you for unauthorized charges that you've already paid, although it may take several calls to customer service to find a representative willing to help.
Hunt down the third party
Having your cellphone provider remove the charge and block new ones is a great start, but you're not done yet, says Dworsky. "So far as the third-party provider knows, you're still subscribed," he says. Contact the company directly through its web site to unsubscribe.
Complain
If you believe any charges on your wireless bill stemmed from misleading business practices, reach out to the Better Business Bureau, your state attorney general and other consumer advocates⁷. Airing your grievance publicly helps them identify the worst offenders to go after and will help prevent others from being charged, too.

Unauthorized Charges on Your Local Phone - Utility Bill?

Unauthorized Charges on Your Local Phone - Utility Bill?
FCC fines Verizon over 'mystery' fees $25 million and $52 million in refunds – 10/28/2010

How to Find Them, Eliminate Them & Get Your Money Back! R1
If your business still gets its phone service through the old "AT&T and Verizon, etc" local phone company (as opposed to one of the newer competitive phone providers) then you need to double check your phone bill each and every month for charges you did not authorize. You may not know it but the local phone company allows other companies to bill you through your local phone bill. And while the local phone company allows other businesses to bill you through your local phone bill, the local phone company does not verify that the charges being billed to you by the other company are valid. When these unauthorized charges fraudulently appear on your phone bill it's called "cramming". Unfortunately you as the business owner or manager are the only one that can spot the unauthorized charges and if you don't comb over your bill every month to spot these unauthorized charges - you'll pay for them.

Customers get crammed when a dishonest company puts charges on their phone bill (landline or wireless) for services that were not wanted or authorized.

Why does the local phone company allow other companies to pass charges onto your phone bill? "Third-party billing" is supposedly a great convenience in that you only have to pay one bill instead of separate bills for obvious authorized phone related charges like yellow-page advertising in the "real yellow pages", 411 information calls and long-distance calls from your chosen long distance carrier. Over the years though, some less-than-scrupulous companies have realized that most businesses rarely scrutinize their local-phone bills. To take advantage of this, these companies have come up with elaborate schemes to place unauthorized charges on your phone bill that you'll end up paying for without even thinking. Unauthorized charges you can end up paying for include charges for unwanted (and unused) email accounts, web sites, directory information calls, directory advertising in obscure publications, voice mail accounts and other services.
In theory, before these charges can be placed on your phone bill, the company that is originating the third-party billed charges is supposed to have a verification of the order like a voice recording. In reality though, all the company needs to do to initiate the charge is submit your name and phone number to the billing entity. The verifications are only required to be produced if a complaint is filed.
To prevent these charges from appearing on you business phone bill it's helpful to understand the four parties that make unauthorized third party phone charges a costly reality. Party number one is any employee who can answer your business phones. The  unauthorized charge is rarely random and it usually happens after one of your company employees gets a telemarketing call. Employees should be instructed to document and report any overly aggressive telemarketing calls they receive. Party number two is the telemarketing company that originates the unauthorized charges by trying to get your employee to accept some service for which you'll be billed through your local phone bill. Party number three is the third-party billing company that has billing agreements with your local phone company. The name of the third-party billing is the one that is prominently displayed on your phone bill. After the third-party billing company's name is the name of the company that is originating the unwanted charges. Party number four is your "former Ma Bell" local phone company that collects the unwanted charges (keeps a share for "Ma") and then passes the rest to the third-party billing company (who keeps a big share) and then passes the balance on to the company that initiated the unwanted charge.
Following are some of the top third-party billing names and unauthorized charge originators you'll find on your phone bill. If you see these names on your phone bill you'll want to call the toll free number listed next to the charge to confirm it's a charge that's been properly authorized to be placed on your bill. Following are actual examples that we've recently found while auditing business phone bills.
We recommend customers should review any utility bills issued by deregulated utility companies. (In most instances today, consumers are paying higher charges to the deregulated gas and electric supply companies).
All Utility - Energy, gas, electric and water bills should be reviewed for proper reading and tariff.
If you suspect that you have been overcharged ask for detailed explanation and or file a complaint with your State Utility Commission.
YJ Draiman for Mayor of LA

FCC proposes crackdown on phone-bill cramming

FCC proposes crackdown on phone-bill cramming Scam widens with cell-phone users; few customers notice bogus charges
Below:

 

 

 By Herb Weisbaum

The Federal Communications Commission Tuesday proposed new rules designed to reduce a common telephone billing scam called cramming.

 

Customers get crammed when a dishonest company puts charges on their phone bill (landline or wireless) for services that were not wanted or authorized.

 

On Wednesday, the Senate Commerce Committee, chaired by Sen. Jay Rockefeller (D-W. Va.) will hear testimony on the issue.

 

Cramming has been around for more than a decade — ever since phone companies were allowed to make extra money by billing for other companies. Until recently, the phenomenon had been largely limited.
..The FCC estimates that as many as 20 million people are crammed each year. The bogus charges are for everything from yoga classes and psychic hotline memberships to cosmetics and diet programs.

 

More alarming, a commission study found that only 1 in 20 cramming victims realizes they’ve been scammed.

 

That’s because the crammers are clever. They know how to make their illegal fees easy to miss. They keep the dollar amounts small (sometimes as little as $1.99) and list them on the bill as something innocuous, such as “monthly charge” or “service fee.”

 

“People don’t see it,  and if they do see it, they don’t pay attention to it,” says Joel Gurin, chief of the FCC’s Consumer and Governmental Affairs Bureau. “Month after month it adds up to millions of dollars across the country.”

 

Reduce your risk

 

Sometimes, there’s nothing you can do to prevent a determined crammer from adding fake charges to your phone bill. However, you can avoid giving would-be scammers the opportunity by being wise to some common ploys:

 

Enter to win: You think you’re entering a contest, but you’re actually giving your information to strangers who might be up to no good. Before you fill out a contest entry form, consider whether you know the company, and be sure to read the fine print. Shady promoters sometimes use an entry form as “permission” to enroll you in a service. You find out you’re enrolled only if you notice the fee on your phone bill.

 

Join the club: The ad says it’s free, and in fact, the number you call to join may be toll-free. All you have to do is say your name and “I want the service.” But you may end up enrolled in a club or service program that comes with a monthly charge on your phone bill.

 

More: Cramming: Mystery Phone Charges

 

Source: Federal Trade Commission
.By the time Alan Cooper of Bellevue, Wash., spotted the $9 fee crammed on to his wireless phone bill, had already paid $117.  He complained to his wireless company, but they didn’t help.

 

“I’m angry,” Cooper says. “Wouldn’t you get angry if someone was stealing $9 a month from you?”

 

AdChoicesCooper was being charged for an 800-number he had never ordered from a company he had never contacted.

 

“Unfortunately, you cannot assume that every charge that’s on your phone bill is a charge that should be there,” Gurin says. “The more we can make people aware of that and give them the tools to really deal with this problem, the more rapidly we’ll see some major progress in the fight against cramming.”

 

The new rules proposed by the FCC today would do that in three ways:

 

* Notification: Many landline companies make it possible for customers to block all third-party charges, eliminating cramming. The new rule would require phone companies that offer a blocking service to tell customers on every bill and on the their website.

 

* Separation: Landline companies would be required to have billing statements that show third-party charges in a different section from the phone company’s charges. This should make it easier to spot charges that might be fraudulent.

 

* Contact Information: Both landline and wireless phone companies would be required to put FCC contact information on their bills. The FCC will try to help and use those complaints to go after crammers.

 

The FCC’s Gurin says the FCC will continue to prosecute crammers. Within the last month, the commission has proposed fines against four companies totaling almost $12 million for allegedly billing thousands of people for unauthorized long distance service. (Click here to read FCC news release.)

 

Cramming moves to wireless phones  
The problem is especially thorny for cell-phone users, because many bill legitimate third-party services (such as ringtones and downloads) to their wireless bills. That makes it even harder to spot an unauthorized charge.

 

Janie Smoter of Bonney Lake, Wash., got burned by a crammer after she went to a coupon website that required her email address (common practice) and cell phone number (risky).

 

“Immediately after I did that I started getting text messages for different things like daily horoscopes and love lines and that kind of thing,” she tells me.

 

Smoter did not sign up for any of the services. In fact, she says, she declined them all. But about a week later, when she checked her wireless bill and spotted a "premium text message" charge of $9.95 for that day.

 

AdChoicesAfter getting the runaround from the company that billed her, she was able to get her wireless company to remove the charge.

 

“It’s infuriating,” Smoter says. “I spent hours trying to get this resolved. And I was lucky because I caught it right away.  I was reading stories of people online and some of them had hundreds of dollars on their bills from this company and they weren’t able to get any resolution.”

 

Be on guard
You’d think the phone companies would be responsible for any charge they put on your bill. But that’s not the way it works. It’s your job to watch out for erroneous charges and fight to get them removed.

 

That’s why you need to check your bills carefully each month. Look for anything that doesn’t seem right. This is especially important if you use automatic payment, since you’re probably less likely to check your bill each month.

 

Go on the offense: Contact your landline phone company and see if they offer a service where you can block third-party charges. I did that with my home phone a long time ago and I’m glad I did.

 

If you are crammed and can’t get the problem solved, contact the Federal Communications Commission. They are one of the few federal agencies that will actually go to bat for you. You can reach them online or by phone at: 1-888-CALL-FCC. You should also file a complaint with the Federal Trade Commission which also prosecutes cramming cases.

 

More information:

 

•FCC: Cramming - Unauthorized, Misleading, or Deceptive Charges Placed on Your Telephone Bill

Phone Service Check List: Please Circle Applicable Service.

Phone Service Check List: Please Circle Applicable Service.

Main BTN: (____)___________    Customer Name:___________________Location________

Yes   No           01.  Line Backer

Yes   No           02.  Automatic Callback,  2a. Repeat dialing,  2b. Three way calling

Yes   No           03.  900 or 976

Yes   No           04.  Access Codes for Long Distance, no dial around

Yes   No           05.  Hunt Group

Yes   No           06.  Voice Mail

Yes   No           07.  Call waiting

Yes   No           08.  Caller ID

Yes   No           09.  Block International Calling  - Pic Freez L.D. & Password

Yes   No           10.  Restrict 411 to one line (fax or pvt. line)

Yes   No           11.  800 #

Yes   No           12   Calling Card

Yes   No           12.  Program Phone System CPU not to accept 1010, not more than 15 digits & 411 one line.

Yes   No           13.  UPS on Phone CPU

Yes   No           14.  Consolidated Billing with sub-accts. (all voice local, L.D. and data on one bill)

Yes   No           15.  Level 5+ wiring,, modular phone system, type of system

Yes  No            16.  Is your system Wi-Fi ready – IP phones – Internet dialing, DID-PRI, T1, DSL, Voice over broadband,

                                system has to be functional, durable, Customer service and support – parts for many years, system brand

Yes  No            17.  Third party billing restricted

Yes   No           18.  Password protected

Yes   No                   Cellular phones – group rates, shared minutes, free dialing in group, best program, favorite nation

Thank you,               Cable/Dish – Master antenna system – channel inserters

____________________________

The Management

Please sign and fax back to: 818-366-6999 Attn. YJD

USGET.05022008

The lack of control of your telecom expenses

The lack of control of your telecom expenses

It's surprising how many of the world's best run companies do not have adequate control over their telecom expenses.  But rapid consolidation and other business prerogatives have pushed telecom expense management to the back of the room. Eventually it comes down to lack of staff, no time, and little budget. Here's what happens.

u Unexplained and unchecked cost increases, new programs, reduced costs     

u Lack of process from procurement to payment (no checks and balances)

u Decentralized invoice and vendor management (purchasing power)

u Decentralized provisioning management (no coordinated system)         

u Limited resources to audit invoices/contracts (non existing) 

u Incomplete or partial inventory management (old equipment)   

u Lack of automation to perform detailed tasks (no management software) 

To know what equipment and service you have, why you have it, and how to use it.  This is the way it should be, and our mission is to help you get there with optimum management services.
Let Energy Savers review and audit your telecommunications services
Call: YJay Draiman – 818-366-6999
Email: renewableenergy2@msn.com

Web: www.energysavers2.com

Telecommunication Audits and Procurement

Telecommunication Audits and Procurement

Utilize our resources to reduce your Telecom costs.
Our telecom audit and telecom cost management will design an optimization and cost reduction program based on your organization’s needs. Our auditors are experts in managing and reducing telecom costs through rigorous processes and technologies combined with their own creativity and insightfulness.

In today’s business environment and advancing technology it is financially prudent for the consumer to monitor, audit and modify the telecom services to adjust to the times and the demands of the customer’s current business requirements.
In a world where telecom service providers modify and change programs and tariffs it is of utmost importance to have an ongoing rate and tariff monitoring that adjusts to today’s environment and combines to maximize cost savings by incorporating software, hardware and services as a economical package.

Contact us for telecom audit, telecom cost management, inventory and invoice automation, cellular management, and all forms of telecommunications expense management and consultancy solutions.
YJay Draiman - Energy Savers - 847-274-3100 or renewableenergy2@msn.com.