The FCC unveiled a Cramming Tip Sheet to help consumers identify and resolve mystery fees if they've been affected.
Building on the Federal
Communications Commission's Consumer Empowerment Agenda, FCC chairman Julius
Genachowski announced plans to propose new rules that would increase
transparency and disclosure on phone bills, with the aim to protect Americans
from "mystery fees" and "cramming," which is the illegal
placement of an unauthorized fee onto a consumer's monthly phone bill.
The charges are for services
like long distance calling, voicemail, or even diet plans or yoga classes that
the consumer neither requested nor used. Speaking at the Center for American
Progress, Genachowski also unveiled an FCC Cramming Tip Sheet to help consumers
identify and resolve this type of mystery fee if they've been affected.
"Cramming is not only
illegal, it erodes consumer trust in communications services. The FCC will not
tolerate cramming, and we are turning up the heat on companies that rip off
consumers with unauthorized fees," Genachowski said. "We want to send a clear
message: If you charge consumers unauthorized fees, you will be discovered and
you will be punished."
A recent survey showed that
only 5 percent of consumers who were impacted by a particular cramming company
were aware of the monthly charges. Based on the same survey and state data, the
FCC believes an estimated 15 million to 20 million U.S. households a year
potentially have these mystery fees on their monthly landline phone bills.
One example of cramming
involves a St. Louis woman who was charged for 25 months of long-distance
service she never authorized or used. When she protested the charges, the
company sent her a copy of the form that she had supposedly used to authorize
the service. It had a different name, address, email and birth date than she
did. Even so, the long-distance company offered to credit her only a fraction
of the cost.
Empowerment Agenda is focused on harnessing technology and transparency to
empower consumers with the information they need to make smart decisions and to
make the market work," he said. "When abusive practices require action, we will
act. We are focused on empowerment, education and enforcement."
The FCC Enforcement Bureau
issued Notices of Apparent Liability last week to four companies for allegedly
charging thousands of consumers for long distance service that they had not
ordered. The companies targeted in the FCC Notices of Apparent Liability are Main
Street Telephone ($4.2 million), VoiceNet Telephone ($3 million), Cheap2Digital
Telephone ($3 million) and Norristown Telephone, ($1.5 million). The unlawful
billing appears to have continued for months, the FCC noted.
According to the Enforcement
Bureau, only one-tenth of one percent (0.1 percent) of consumers in two of the
cases reviewed actually used the additional services for which they were being
charged. "Today, we are saying loud and clear to consumers trying to
navigate the complex and constantly changing communications landscape: The FCC
is on your side," Genachowski said. "We are focused on helping all Americans
seize the tremendous opportunities of communications technology."
FCC Commissioner Michael J.
Copps said in a statement: "These charges can be heavy and, if undetected,
repeated for months and even longer. I congratulate Chairman Genachowski for
his statement today, and I look forward to working with him and all my
colleagues to move us expeditiously to a final order to enhance basic consumer
rights," Copps said.
Nathan Eddy is Associate Editor, Midmarket, at eWEEK.com. Before joining eWEEK.com, Nate was a writer with ChannelWeb and he served as an editor at FierceMarkets. He is a graduate of the Medill School of Journalism at Northwestern University.