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Consumer complaints lead to action against cramming

Consumer Reports News: May 17, 2011 12:28 PM

As we reported last month, a stepped-up war on telephone cramming by AT&T and the U.S. Senate Commerce Committee seems to have reduced the placement of unauthorized charges on millions of consumers' phone bills.

But the unsung heroes of this war are consumers, hundreds of whom have complained loud and clear enough to get the attention of authorities at the Federal Trade Commission, Federal Communications Commission, state offices of attorneys general, and the Better Business Bureau.

The Commerce Committee investigation, for example, was launched in June 2010 because "there had been complaints about unauthorized third-party charges on phone bills dating back to the late 1990s, which has continued uninhibited," said a committee aide.

So far, the Commerce investigation has turned up the names of more than 250 third-party billing companies—which sell such services as voice mail, collect calls, Web hosting, e-books, software downloads, online games, donations, and subscriptions—that have a D or F rating from the BBB, thanks to their high level of consumer complaints.

Third-party billers send their charges to aggregators, who compile and send the charges on to the various phone companies, who then add them to their customers' bills. In most cases, such charges are legitimate, but if you didn't order the service, the charges could violate federal law as unfair and deceptive billing practices.

One such aggregator, BSG Billing Services, controls some 85 percent of the bill-it-to-your-phone industry. It uses a thicket of corporate aliases and guaranteed-to-confuse billing codes—including ESBI, HBS, OAN, USBI, and ZPDI.

When we looked last year, BSG had a C rating and a three-year record of 750 complaints filed against it with the BBB of San Antonio, Texas, where the company maintains headquarters. Now, the BBB reports a total of 788 complaints spread across four BSG companies rated and variously named as follows:

We also checked consumer complaint boards, like RipoffReport.com, ClassActionConnect.com, and PissedConsumer.com, and found hundreds of complaints about those companies.

Consumer complaints about BSG related to cramming of unauthorized charges on telephone bills have also prompted the Florida Office of Attorney General to commence an Active Public Consumer-Related Investigation, said Jennifer Davis, a spokeswoman for the AG's office.

The investigation is a civil, not criminal one, and its existence does not constitute proof of any violation of law, the attorney general's office said. "BSG has never received any written notice or documentation that it is under investigation by the Florida AG, other than the nondescript listing on the website," said Leslie Komet Ausburn, a BSG spokeswoman.

Despite so many angry customers, Ausburn told us that BSG actually leads the industry in cramming prevention and has "taken action" against more than 50 third-party billers since 2007. Ausburn didn't give further details, but company filings (PDF) provide clues that BSG has "terminated" its relationship with some problem companies but "worked with" others to improve their practices.

Good work, consumers! Keep the pressure on. Keep those cramming complaints coming.

Jeff Blyskal

   

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