Unbridled Fraud Targeting U.S. Immigrants — A call to action!
Today, the technically astute can contact family and friends using the Internet, or by using a variety of smartphone apps. But for low-income immigrants or visiting internationals, their only answer may be prepaid calling cards, which have been investigated as a source of consumer ripoffs. In many cases, the scams of some prepaid calling card issuers are illegal.
Facts from the FCC, ABC News, QuickCall.com and the CTIA–The Wireless Association:
· Over the past decade, the prepaid calling card business has mushroomed into a $4 billion business.
· In 2015, FCC fined six companies a combined $30 million for deceptively marketing prepaid calling cards to immigrants, and for falsely advertising that their low-cost prepaid calling cards could allow consumers far more calling minutes than were in fact being sold.
· Only 11 states including California, Florida and Illinois have laws dealing specifically with the calling card industry, with the other states relying on general consumer protection regulations. There has been very little enforcement of existing rules.
· The fees charged by cards are numerous: Dollar Phone charges a service fee of $0.25 per minute, on top of any international rate charge. STI charges a “disconnection fee” of $0.90 on calls less than 5 minutes. Noblecom.com and AmanTel charge online order processing fees (up to $2 on a $5 card). Almost all cards charge a weekly “administrative fee” that quickly depletes the card value.
· In a recent research study of prepaid cards by QuickCall.com, most use “rounding-up” which impacts the final price of a call. For example, if a call ends after 1 minute 20 seconds, some providers may round up to 3 additional minutes (totaling a 4–5 minute charge).
· In many of the prepaid calling cards sold in Hispanic neighborhoods, the front of the card is written in Spanish while the small print disclosures on the back of the card are written in English.
· “Victims include soldiers calling home from abroad and foreign students studying in the U.S. But the people most vulnerable to these scams…are the newest arrivals (immigrants) who speak little English and don’t have the money or documentation to get a home phone line or cellphone — much less a computer — to communicate with relatives overseas.” ABC News by Joelle Tessler
· “It’s appalling that so many of these companies continue to take advantage of immigrants or naïve people who are not sophisticated about their choices in international calling.” Dana Todd, Chief Marketing Officer, QuickCall.com
· “The FCC took its sixth enforcement action in just over a year against a provider of prepaid calling cards. The FCC’s investigations have found that due to undisclosed fees and ‘fine print’ consumers would get only a fraction of the advertised minutes.” Federal Communications Commission
· “The prepaid calling card industry is open to so much fraud that it was featured in an episode of HBO’s series ‘The Sopranos’ as an easy way for the mob to make money.” CTIA — The Wireless Association
A CALL TO ACTION!
According to primary research conducted recently by QuickCall.com (download the full report PDF), the industry is not policing itself despite a decade of investigations, fines and legal battles. As a consumer, though, there are steps you can take if you feel you’ve been ripped off by a calling card company. Contact your states Attorney General and file a complaint, file an online complaint with the FCC or call 1–888-CALL-FCC (1–888–225–5322).