ARCHIVED - Telecom - Commission Letter - 8665-C12-15/02 - Tariff Notices Nos. 740and 741
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File#: 8665-C12-15/02 Ottawa, 9 April 2002
David Palmer, Dear Mr. Palmer, Re: Tariff Notices Nos. 740 and 741 Bell Canada, Aliant Telecom Inc., MTS Communications Inc. and TELUS Communications Inc. (collectively the Companies) are requested to provide responses to the attached interrogatories by 7 May 2002. Yours sincerely,
Shirley Soehn Attach.
Cc: CRTC Regional Offices Attachment
13. For each program identified in response to question 13, advise whether there is a section of the SP agreement that prevents the Companies from entering into an SP agreement with service providers intending to offer such programs and if so, identify the relevant section. 14. Provide the Companies views on having a schedule to the SP agreement that describes the types of programs for which the Companies will not enter into an SP agreement. What should such a schedule contain? 15. Under the ARM agreement, first-time disputed charges are waived by the Companies and absorbed by the service providers. Service Providers that are not operating under an ARM agreement have no such requirements with respect to disputed charges. Provide the Companies' views of making such a requirement part of the SP agreement or ABA or both.
The Ottawa Citizen When Denise Ferguson opened her pre-Christmas phone bill, her heart sank and blood pressure rose. At the bottom of her monthly Bell Canada bill were surprise charges -- totaling $297.67 -- for calls made to a recipient marked only "Psychic." The Peterborough mother of five boys contacted the Bell office, which verified four successive calls had been made from her home one afternoon when she was absent. Apprehensively, she questioned her oldest son, Drew. He is 19, but congenital mental and physical handicaps mean he has the intellectual ability of a 10-year-old, and he cannot attend school or hold a job. He can read only at a Grade 5 level. He has had four pacemakers and endured nine major surgeries. He has only vague concepts of time and money. For that reason, the permanent disability pension he receives is deposited directly into a bank account. Drew hung his head, his mother says, and admitted he had seen a TV ad for a free psychic reading, then curiously dialed the number advertised. He pretended to be different people each time. Ms. Ferguson says Bell was unmoved when the circumstances were explained, and refused to identify the name or company behind "Psychic." She glumly paid the bill. Drew and his younger brothers got a stern warning: don't call the psychic line. But weeks later, the psychic line called them. While their mom was out, at the same mid-day time Drew had made his outgoing calls, someone persistent wanted to know why the service had not been used again. Another "free" psychic reading was offered, Drew says, and the chance to have his fortune told with tarot cards. Stricken with fear, he hung up instantly. Good thing. Drew was dealing with Miss Cleo's Psychic Hotline, one of the continent's most sophisticated -- and lucrative -- telephone scams. Miss Cleo -- the jive-talking woman with a Jamaican lilt and wide, welcoming smile who invites TV viewers to confide about two-timing husbands, sick sisters, romance and financial woes -- is a Miami actress who auditioned for the part. Her real name is Youree Cleomili Harris. Turns out the only psychic is Steven Feder, a Florida multimillionaire who divined that his company, Access Resource Services Inc., could garner $300 million U.S. each year by hiring legions of telephone operators to mine millions of gullible, lonely, or depressed people by taking on the guise of psychics. With more than a dozen affiliates, the Miss Cleo companies purchase expensive toll-free and 1-900 numbers across the continent, pitching psychic or tarot card readings in cheap late-night and daytime TV ads. The toll-free numbers are used to glean customer data from callers before they are switched to affiliated 1-900 numbers. Often, they are put on hold as the meter clicks away, typically at a rate of $350 an hour, until a phony psychic arrives on the line to drawl out a cue-card prophecy. If the calls stop coming, other operatives phone to find out why. Repeatedly. In several states, the companies behind Miss Cleo are facing charges or fines for fraud and telephone harassment: - Last fall, New York state charged the operation with more than 100 counts of breaching state telemarketing laws, with potential fines of $244,000 U.S. - Missouri filed fraud charges for billing customers for services advertised as free, and fined the company $75,000 U.S for telemarketing harassment. - Lawsuits against the Miss Cleo companies were filed by the attorneys-general in Arkansas, Illinois, and Kansas. In Arkansas, the company settled by wiping out all charges owed by phone-line customers from 2000 and 2001. - Last fall, 85 complaints by Florida residents were filed with the state consumer board, with potential fines of $10,000 U.S. per complaint; a class-action suit against the Miss Cleo company there is being prepared. Pennsylvania and Minnesota are also investigating the company's practices. "This so-called psychic service appears to be a scam to keep people on the phone as long as possible," said the director of the New York State Consumer Protection Board, who released a report on the Miss Cleo companies and their clones last fall. "It's obvious this is a scam," Denise Ferguson told the Citizen, eyes blazing. "If they were psychic, they would have known (Drew) was a child. These are people who work for a company that rips people off. It's wrong. "My son doesn't fit into this world. He's not really accepted, and he gets depressed. Sometimes he is sad and disturbed. So maybe part of him wanted to find out if they could help him, or give him direction in life. It makes me mad that there are people who are trying to make money off people who are hurting and suffering." Late last week, hours after the Citizen called Bell Canada officials for an explanation, Ms. Ferguson was promised a refund equal to the Miss Cleo charges unwittingly run up by her son. Her phone was also equipped to block outgoing 1-900 calls at no charge. Bell Canada official Andrew Cole said his company does not garner any revenue from the Miss Cleo billings, since that account was placed with British Columbia-based Telus Corporation. In cases where nationwide numbers are advertised, he says, the phone companies "swap" billing costs when the customers reside outside their territories. He said it appeared from the phone records that Drew may have been put on hold for some 16 minutes three times, at which point the call was automatically terminated. By then, $100 had been charged for each call. "Sometimes these services put callers on hold indefinitely, while the charges run up," says Mr. Cole. "We have a system that, after 16 minutes on hold, automatically cuts off the line. Bell also offers, for a one-time fee of $10, a service that blocks all outgoing calls to 1-900 numbers." Asked if a service pitching psychic advice was inherently fraudulent, Mr. Cole said, "I can't say what's a good psychic or a bad one. I can only tell you what is a good or a bad business. In this case, the customer was not well-served." Telus official Nick Culo says the Miss Cleo operation in Canada operates under a service contract with Telus, which provides the 1-900 number. He declined to provide the number of annual calls made nationally to the "psychic hotline," or the annual revenues Telus collects. "We're not going to disclose revenues. That's confidential. That's between us, the company, and the millions of callers out there." Mr. Culo said he was not aware that the Miss Cleo operations were facing fraud and telemarketing abuse charges in several U.S. states. "I can't comment until I know the extent of the legal challenges. Any legal action is a matter for the courts. But this is a very closely regulated industry in Canada." Mr. Culo declined to provide a contact name for the company, and no one answered the telephone at the Florida headquarters of Access Resource Services. Customers with complaints about the Miss Cleo operations in Canada can call a toll-free number -- 1-800-469-5876 -- in which a recorded voice advises there are ways to dispute billings, challenge billings due to calls made by minors, and be deleted as a mail and telemarketing target. However, no person fields the calls; complaints must be mailed to a Ft. Lauderdale, Florida, post office box. Mr. Culo says Telus does not pre-screen operations like the Miss Cleo hotline before 1-900 lines are approved. Instead, he says, there is ongoing monitoring in Canada by an independent company that checks performance and ensures federal regulations are complied with. If they find serious problems, he says, telephone companies like Telus or Bell are notified and the service can be shut down if the problems are not corrected. Paul McKay is a Citizen reporter. His e-mail address is: pmckay@thecitizen.southam.ca |
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