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  • 28
    Mar
    2012
    7:07pm, EDT

    After investigation, AT&T, Verizon agree to stop 'cramming' phone bills

    By Bob Sullivan, Columnist, NBC News

    Verizon and AT&T have agreed to stop “cramming” consumers' telephone bills with unauthorized third-party charges, Sen. Jay Rockefeller announced Wednesday. The move comes after a Senate investigation revealed last year that consumers were hit with $10 billion in fraudulent charges due to the practice over the past five years.

    A TODAY show/msnbc.com investigation in July  revealed how extensive and frustrating cramming is, with maddening, mysterious $10 or $20 charges appearing every month on millions of Americans' phone bills.

    The investigation relied on a report commissioned by Rockefeller that found that three telecom firms - -- Verizon, AT&T and CenturyLink/Quest -- earned $650 million as their cut of cramming charges levied by third-parties since 2006.


    Follow @RedTapeChron

    "AT&T made the right decision to end cramming by August," the West Virginia Democrat’s office said in a statement on Wednesday.  "Something had to be done.  And while the decisions of AT&T and Verizon are a step in the right direction, I still believe we need to pass a bill that bans this abusive practice once and for all.”

    “AT&T has decided to discontinue most third-party billing on our customers’ landline accounts,” Michael Balmoris, an AT&T spokesman, said in a statement to msnbc.com. "We currently receive cramming complaints for only about one out of every thousand bills that contain third-party charges.  However, due to continued concern over the possibility of unauthorized charges, we have decided to take this additional step and eliminate third-party billing for most types of services.”

    Verizon spokesman Bill Kula also confirmed the change, saying in an email: “On March 19, Verizon’s wireline business began notifying its billing aggregators (or “clearinghouses”) and carriers that it is going to cease providing third-party billing services for so-called 'miscellaneous' or 'enhanced' services. All billing of those services will be phased out by the end of 2012.  … Verizon wireline will continue to provide billing services for third party charges that generally relate to telecommunications or information services that use our network.”

    Separately, Verizon earlier this month agreed to settle aclass-action lawsuit related to cramming, and agreed to refund 100 percent of victims' money for any unauthorized third-party charges consumers suffered from April 27, 2005, through Feb. 28, 2012.

    Cramming has vexed consumers and generated mountains of complaints since 1995, when land line providers began making it easy for third-party firms to sell add-on services like voice mail through local phone bills. 

    The problem is it's too easy for third parties to attach unwanted items to consumers' bills:  Previous investigations have found firms frequently trick consumers into signing up using sweepstakes entries or cashing small checks that also serve as authorization forms. In other cases, the third-party firms simply lie about getting authorization, a scam called “phantom billing.” Last year, Illinois Attorney General Lisa Madigan testified that usage rates for the unwanted services could be as low as 1 percent.

    "Committee staff has found hundreds of egregious examples of cramming," the Rockefeller report found. "Third-party vendors have enrolled deceased persons in their so-called services and charged family members' telephone bills for it. They have charged telephone lines dedicated to fire alarms, security systems, bank vaults, elevators and 911 systems. Senior citizens' telephones have been enrolled in web-hosting services, even though they have never used. A children‘s hospital was charged for a celebrity tracker e-mail service that provided daily celebrity news feeds, photo, and videos. A national bank‘s telephone lines were charged for credit protection plans."

    Perhaps nothing illustrates how out of control cramming had become as well as AT&T's own victimization.

    "Committee staff confirmed that third-party vendors associated with one hub company crammed at least 80 of AT&T‘s own telephone lines with charges for services such as voicemail, sometimes for periods as long as 18 months," the report said.

    *Follow Bob Sullivan on Facebook     
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  • 17
    Oct
    2011
    6:40am, EDT

    AT&T dials up merger support from charities

    The Federal Communications Commission has been flooded with more than 10,000 public comments for or against AT&T's controversial proposal to buy T-Mobile — some of them from small church and charitable groups that have received donations from AT&T, the Center for Public Integrity reported Monday.

    The acquisition, which would join two of the country's four largest wireless carries, is drawing intense opposition from public interest groups who say it would reduce competition in the fiercely competitive wireless communications sector. The Justice Department is joining Sprint an antitrust lawsuit to block the purchase.

    That hasn't stopped people like the Rev. R. Henry Martin, director the Shreveport-Bossier Rescue Mission in Louisiana, from writing the FCC to urge it to approve the sale, arguing that it would extend the availability of wireless broadband service to more small and impoverished communities.

    'Largesse'
    The Center for Public Integrity, a nonprofit investigative news organization, reports that Martin's letter failed to note that his organization had received a $50,000 donation from AT&T this year, making it one of “at least two dozen charities that were recipients of AT&T's largesse and have written in support of the T-Mobile buyout, which will cut the number of national wireless companies from four to three,” it said.

    Other such groups include a Dollars-for-Scholars program near New Orleans, an agency that helps special-needs adults find work in Michigan and a Habitat for Humanity chapter in South Carolina, CPI reported. Some are so small that they have only a single staff member.

    CPI quotes Craig Holman, a lobbyist with the consumer advocacy group Public Citizen, as saying the donations take “influence peddling to a whole new level."

    AT&T didn't respond to requests for comment.

    Read the full CPI report: Charities supporting AT&T's buyout of T-Mobile have financial incentive

    58 comments

    It's amazing what the clergy will do for money, isn't it? They promise a direct line to god. Phone lines from man to man. They're all about lines........mostly BS.

    Show more
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