By LARRY PHILLIPS • Daily Leader
An article in the Sept. 1 edition of the Hutchinson News caught the attention of Liberal’s Jack Taylor – mainly because he uses AT&T for his home telephone and Internet services.
The article, ‘Calling out fraud’ by Darcy Gray, detailed how consumers had discovered they were paying for hidden third-party charges on their phone bills – charges they had not authorized.
Gray noted, “Sarah Otto became suspicious last month when she noticed a $15 spike in her local phone bill. So, the 26-year-old Hutchinson resident called AT&T to inquire why she was being charged an extra $14.95 for “Enhanced Services” – and to find out what exactly those services were.
“AT&T directed Otto to call the 800 number listed under “Enhanced Services” on her telephone bill. As it turned out, Enhanced Services was short for Enhanced Services Billing Inc., or ESBI, a San Antonio- based company that bills consumers for third-party vendors,” Gray noted This immediately aroused Taylor’s suspicions.
“I read this article in the Hutch paper, and I got my AT&T bill that same day,” Taylor said. “I opened my bill to see if it was there, and sure enough, it was on there – $14.95.”
Gray’s investigation showed, “In Otto’s case, ESBI began billing her on behalf of the company Residential Email.
“After a series of frustrating calls to automated voice-messaging systems for both companies, Otto said she finally reached a Residential Email representative.
“The lady I spoke to was somewhat rude and said the company sells e- mail accounts,” Otto said. “She said I got on the Internet, clicked on an ad, verified my maiden name, my mother’s maiden name and inputted all of this info into their system,” Gray’s article continued.
“They said I confirmed my information in an e-mail and they called and confirmed it with me, too. When I told them I was not authorized to make changes on the account, because it’s in my husband’s name, the lady said, ‘Oh, that’s right. It was your husband.’
“Otto said none of that happened, though. Neither she nor her husband, Adam, signed up for Residential Email or confirmed the service in e-mail or on the phone.”
Taylor, who is the executive director of the S.P.I.R.I.T.
organization, decided to also call the toll free number on his bill.
“I kind of got the runaround in a way, because they wanted all kinds of information, like my birth date and all that sort of thing,”
Taylor said. “I assured them they didn’t need all that – all they needed was my name.
“Then they said, ‘Well, we don’t put it on there unless somebody authorizes it, and Elmer Jack Taylor authorized it.’ And I said, ‘I don’t think he did.’ She said, ‘Do you know him?’ and I said, ‘Intimately – that’s me.’”
The woman still gave him a hard time.
She says, ‘Well what’s your birth date?’ and I said, ‘You don’t need that to take the charge off my bill,’ and she asked, ‘Were you born in ’79?’ and I said, ‘I don’t think so – not without a second birth,’” Taylor added.
Finally, the woman said ESBI would remove the charge from Taylor’s bill.
“I got an e-mail from them the same day saying they would remove it,”
Taylor said. “Obviously, they had quite a few calls from other folks.”
Gray noted in her article that ESBI has now sent the Ottos a refund, and Otto believes she was a victim of “cramming,” in which a company illegally adds unauthorized charges for various services to a consumer’s local telephone bill.
“Otto has since filed a complaint against ESBI and Residential Email with the Kansas Attorney General’s Office, as well as the Federal Trade Commission,” Gray’s article continued.
“She also contacted AT&T for help.
“AT&T told me to get a confirmation number on the refund or (the
company) might not do it,” Otto said. “I had to ask six times to get a confirmation number from that lady.
“They knew full well this is going on, and the woman at AT&T said this happens a lot and (third-party companies) count on people not checking their bill.”
After Taylor got off the phone with ESBI, he, too, called AT&T.
“I told them I didn’t appreciate that being on my AT&T bill,” Taylor said. “The fellow I talked to said they were required by law to put any charges that a third party provider tells them to put on there.”
Taylor thought that explanation seemed fishy, but he said he didn’t get the man’s name.
Gray’s article noted, “The Kansas Attorney General’s Office received
117 complaints about phone bill cramming in fiscal year 2009, according to Ashley Anstaett, an attorney general’s office spokeswoman.”
Anstaett was out of the office Thursday and was going to be out today as well, so how many complaints have come in from Southwest Kansas are not known at this time.
Gray also discovered Otto was not the only person being billed erroneously. Cindy Boswell of Hutchinson also reported noticing a $15 increase in her phone bill in late July.
Gray reported, “Boswell was also billed by ESBI, except she was billed for voicemail services she never signed up for through Intelicom in Henderson, Nev. She is still awaiting a refund from the company.
“Her neighbors have had the same problem, Boswell said.
“My neighbor was told her husband signed up for the services, but her husband is dead,” Boswell said.
“Both Otto and Boswell have had AT&T block third parties from their accounts, something AT&T acknowledged customers can opt to do.”
Gray wrote that Otto began to dig even further into ESBI.
“Frustrated by the deception, Otto did a little research of her own and discovered Enhanced Services Billing Inc., a subsidiary of New Century Equity Holdings Corp., had already been investigated by the Federal Trade Commission several years ago for deceptive practices that violated the FTC Act,” Gray reported.
“In August 2001, New Century settled with the FTC and agreed to repay $350,000 to consumers.
“ESBI was also required to provide notices to consumers that their bills may contain unauthorized charges for enhanced services. They were required to inform consumers how to obtain a refund, too.”
Taylor said he will be going through his past bills from AT&T to see how long this charge has been on his bill. He will be seeking a total refund if it’s been there for awhile.
Gray noted, “Otto questioned why AT&T would continue to allow ESBI to bill consumers when it had already been in trouble with the FTC in the past.
“It’s crazy that AT&T would allow a company with an FTC charge against them to still charge people’s accounts,” Otto said.
EDITOR’S NOTE: We wish to thank The Hutchinson News journalist Darcy Gray for allowing us to use much of her reportage on this activity.