Monkey Bob Battles "The Crammers"

I recently became aware of a telephone billing scam called "cramming". The FCC (Federal Communications Commission) defines this practice as follows:

“Cramming” is the practice of placing unauthorized, misleading, or deceptive charges on your telephone bill. Crammers rely on confusing telephone bills in an attempt to trick consumers into paying for services they did not authorize or receive, or that cost more than the consumer was led to believe."

Cramming charges are usually under $50.00, and are usually located somewhere near the end of the (multi-page) phone bill, so many consumers may not even notice them

Twice in the last year, I have (allegedly) been crammed. The last company involved was:

YP Corp. - which is associated with YP.Net, YP.Com, and Yellow-Page.net. (The last three company names bring up the same website.) Their stock ticker is YPNT. They recently added a $27.50 charge onto my last home phone bill for something called "web maintain". I never requested this service, nor authorized them to charge me for it.

In investigating this matter, I discovered some disturbing reports about the YP group of companies:

1) In December of 2006, YP.Corp agreed to pay $2 million in refunds after settling in court with the Attorneys General of 34 states. In a 12-14-06 statement from The Office of the Attorney General of Missouri - Attorney General Jay Nixon said that "The businesses and organizations often did not realize that depositing an “activation” check for $3.25 from YP Corp. — which does business under the names YP.com, YP.net and Yellow-Page.net — triggered a monthly charge of $25 to $30 on their telephone bills or from their bank accounts for an Internet directory listing."

Many of the victims of this tactic were churches, schools, and non-profit organizations. These were good candidates for cramming because they receive many checks, which are often processed by volunteers. These volunteers usually don't scrutinize received checks for any legal fine print.

2) According to an April 2, 2003 article in The Jacksonville Business Journal, a Federal jury convicted Michael Bloomquist of fraud conspiracy. According to Citron Research, Michael Bloomquist was a director of Telco Billing, a wholly owned subsidiary of YP.Net.

3) According to an SEC Report filed on 6-1-04, "YP Corp. ("YP") announced that its Chief Executive Officer, Angelo Tullo had resigned as an executive officer and director of the Company as a result of indictments handed down against him by a Federal Grand Jury for matters unrelated to YP Corp." Citron Research said that these Federal indictments were for Fraud and Money Laundering.

4) According to a US Department of Justice document dated June 27, 1996, Douglas Carpa was one of 6 defendants convicted on 72 counts of tax evasion, mail fraud, conspiracy to defraud the United States, and related charges. According to YPNT SEC filings, Douglas Carpa controlled Gladstone Enterprises. According to Citron Research - Gladstone Enterprises was associated with Hickory Management, which was associated with Sunbelt Financial. And Sunbelt financial was paying Angelo Tullo's salary (see the paragraph above).

Other companies that you should be aware of are:

Axcess Internet Solutions

Email Discount Network – also known as EDN. Note: The Florida Office of the Attorney General recently reached a settlement with this company, where they will repay over $1 million for improper telephone charges. Residents from a number of states are eligible.

ILD Teleservices – also known as ILD Telecommunications Inc.

Northwest Nevada Telco - also known as NWNT

OAN – also known as Operator Assistance Network and OAN Services Inc. They are associated with Nationwide Connections.

Talk America Inc. – also known as Talk.com

Here is how you can protect yourself:

1) Take a closer look at your phone bills before you pay them. With Verizon phone bills, charges from crammers are usually listed on the back 1 or 2 pages of your telephone bill. If you see something that doesn't look right, call your phone company's business office.

2) Don't waste your time calling these crammers. The best way to contact them is by Certified Mail, with a Return Receipt. Just write a simple letter that explains that you did not authorize the charge and that you expect it to be removed in a timely manner. This method carries much more weight, because there is now a paper trail of your complaint, which could later be given to the authorities if the offending company doesn't solve the problem. A certified letter to the crammer may also protect your credit, if the crammer sends (or threatens to send) their charge to a collection agency.

3) You can file a complaint with the Federal Communications Commission and the Federal Trade Commission, but they are unlikely to take any immediate action to help you. They will record your complaint - among the thousands of others that they receive – but action from such agencies moves forward at a glacial pace.

4) File a complaint with the Division of Consumer Affairs in the state where you reside, and also in the state where the crammer is located. Most state Divisions of Consumer Affairs have websites, where you can file a complaint online. I don't know if this is effective yet, but it's worth a shot.

5) Ask your phone company to put a cramming block onto your phone line. This should protect you against most future cramming attempts.

6) File a complaint with the U.S. Postal Service for mail fraud. Your phone bill came to you through the mail, so these crammers are using the U.S. Mail to improperly get money from people. I don't know (yet) how effective this might be, but it may very well turn out to be a strong tool for prosecuting crammers.

7) Send a Certified Letter or an Overnight Express Letter to the CEO of your phone company. You should easily be able to find the name and mailing address of this person on Google. CEOs have "the juice" to get problems resolved quickly. Every time that I have sent a Certified Letter to Ivan Seidenberg, the CEO of Verizon, Verizon has resolved the problem promptly and professionally. In this last incident, Salvatore Tedesco and Sal Tromonda, of Verizon, provided exceptional support. I give Verizon, kudos for their excellent service!

NOTE: In their response to my cramming complaint, Verizon indicated that they cannot prevent crammers from putting charges onto a Verizon phone bill because of The Telecommunications Act of 1996. This act was designed to centralize billing for multiple telephone service providers. However, an unintended consequence of this legislation is that it allows unscrupulous companies to bill phone company customers for charges that they did not authorize.

8) If you have a blog, or if you frequent the blogosphere, spread the word about this practice and the companies involved. The blogosphere is an incredibly powerful tool for affecting social change.

Note No. 1: I believe that truth in journalism is absolutely essential. I have carefully researched the information that I am presenting in this post, and to the best of my knowledge, it is accurate. Where I obtained information from other sources, I have provided links to these sources. All of the sources that I used appeared to be credible.

Note No. 2: Truth in journalism applies to all parties who are reported on. If anyone can present me with information that proves that (any of) the data in this post is inaccurate, then I will change the post, and issue a retraction.

Note No. 3: At the time that this post was written, YP.Corp has not been charged or convicted of cramming - in my situation - by any court of law. However the evidence that I have presented indicates that YP.Corp's charge (on my home phone bill) appears to be cramming.

Note No. 4: Every responsible journalist has an obligation to present both sides of a story. I therefore invite YP.Corp to submit a response to this post.