Rockefeller Probe Into Bogus Charges on Consumer Phone Bills Expands

Letters Going To Additional U.S. Telephone Companies

March 31, 2011

Feature Image: 2 Oversight&InvestigationsWASHINGTON, D.C.—Chairman John D. (Jay) Rockefeller IV today sent letters to five additional U.S. telephone companies to better understand their awareness of “cramming,” a deceptive practice that involves placing unauthorized third-party charges on consumers’ telephone bills. These letters are part of an ongoing Commerce Committee investigation into the small charges—generally between $10 and $20—that millions of American consumers and businesses find on their monthly phone bills.

“Cramming is a widespread problem,” Rockefeller said. “It is likely harming millions of consumers, businesses, nonprofit organizations, and local, state, and federal governments. Telephone companies have allowed these unauthorized third-party charges to be placed on their customers’ telephone bills for far too long. The Committee will keep working until we put an end to cramming and stop the business outfits that profit from it.”

Last year, Rockefeller asked AT&T, Qwest, and Verizon for information on cramming as part of a wide-ranging investigation into the issue. Last December, Chairman Rockefeller sent additional letters to companies that place third-party charges on telephone bills because consumers had complained repeatedly to the Better Business Bureau, the Federal Trade Commission, the Federal Communications Commission, and various consumer-oriented websites that these companies were engaging in cramming.

The text of the letters Rockefeller sent to CenturyLink, Windstream, Frontier Communications, FairPoint Communications, and Cincinnati Bell can be found below. The text of each letter is the same. Additional information on the Commerce Committee’s cramming investigation and the text of the letters sent to AT&T, Qwest, Verizon, and third-party companies can be found here.

How Third-Party Billing and Cramming Work 

Many U.S. telephone companies allow vendors to place third-party charges on their customers’ landline telephone bills. Once a vendor obtains a telephone company’s approval to place third-party charges on its telephone bills, a consumer’s telephone number works like a credit card or debit card account number for that vendor. An approved vendor can accept a consumer’s telephone number as a means of payment and can place a charge for a product or service on the consumer’s telephone bill. Cramming occurs when the third-party charge placed on a consumer’s telephone bill is unauthorized.

What the Commerce Committee Has Learned

  • A significant percentage of the companies placing third-party charges on consumers’ telephone bills have cramming complaints from consumers filed with the Better Business Bureau, the Federal Trade Commission, the Federal Communications Commission, and various consumer-oriented websites.
  • More than 250 of these companies have a “D” or “F” rating from the Better Business Bureau.
  • The services that many of these companies offer do not appear to be legitimate. These purported services are offered free of charge elsewhere or at a much lower rate by companies not charging their customers through telephone bills. The services typically offered by vendors with “D” or “F” ratings include voicemail services, electronic fax services, webhosting, online gaming, and e-mail.