Watch Out For Bogus Charges On Your Phone Bill

Under the current system, telephone companies allow 3rd party companies to submit charges which the phone company then includes in your bill, with no verification other than a list of names and numbers. The phone company keeps a cut and blithely bills away. Scammers have figured this out and will sometimes submit bogus charges, disguised under vague names.

This is why it’s always a good idea to scan your phone bill and look for suspicious charges. If you see a charge you don’t understand, Google it.

If you don’t believe the charge is for a valid service you ordered, you can contest the fee and get it reversed, but the burden is on the consumer to notice and take action.

Watch Your Wallet… And Your Bills [Newsvine]
(Photo: Getty)

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  1. chimmike says:

    had one of these on my wife’s bill. $12.99 for something I’d never seen or heard of before. I called up cingular and they refunded me for the 3 charges and removed the subscription.

    It’s nice, they throw these SUBSCRIPTIONS at you, and you don’t even know what they are! Isn’t that criminal?

  2. gibsonic says:

    don’t cash any “free” $2 checks you receive in the mail.

    cashing the check, signs up you up for some service that you don’t want or need.

  3. Cowboys_fan says:

    When I worked for t-mobile this happened alot. Some of the problems arise when somebody changes their number and these companies still bill the previous # holder. And you’re right that most people don’t notice for months, especially $0.99 here and there. Jamster used to be really bad for this due to deceptive advertising. The phone companies did force them to change their ways so they are working on this crap too, though not to our satisfaction. I used to hate those fights with customers b/c as the csr, we could never be sure. Both the companies and customers are dishonest. I usually gave the benefit of the doubt and refunded the charges, mainly b/c it was easy to credit and needed no approval steps.

  4. Howie999 says:

    These pesky charges hit me too – three different charges for about $12 each in one month. Easy to spot when the bill goes up to $50 and you’re used to $15. One call stopped them (and deleted them retroactively), but what a pain. They claimed someone authorized it, but the name they gave me was some anagram….Moral of the story: go over the bills with a very discerning eye!

  5. RandomHookup says:

    Had a friend of mine from outside the US staying with me and he managed to sign up my phone for 2 of these offers while working to get his “free laptop.” Easy to fix, though and I have blocked 3rd party billing.

  6. davebg5 says:

    This practice is called LEC (Local Exchange Carrier) billing. I am familiar with the practice because I (unfortunately) worked for a shady company that made its millions on the back of this practice (once I fully understood how they made their money, my search for a new job began.)

    Here’s how it would work. A person would click on one of those annoying banner ads that promise you a great, new tech item (think iPhone, PS3, Xbos 360, etc) for “free”. The stipulation would be that you have to enroll in certain subscription programs. There were all sorts of subscription programs. The big money makers for the company that I worked for were online shopping and 800 number/voice mail services. When the user fills out the form they give their name, address, email and home phone number. Then, they click submit, they get an email confirmation to activate their account and the charges start rolling in on their home phone bill.

    Here’s where things get sketchy. Despite the fact that the cost of the subscription is displayed on the site, people don’t realize that they are going to be charged anything. They figure that as long as they are not giving out a credit card number, then it won’t cost them. They are wrong, as the charges go to the phone number submitted. There is a verification done to make sure that the phone number and the address are a match to the extent that the three digit exchange had to belong to the zip code in the address (at least that’s how it worked where I was). However, that does not preclude someone who is not authorized on that number from signing that phone number us for the service. Sometimes it was a worker who signed up a phone number at their place of employment, but used an email address of their own to activate and access the service. Other times it was a practical joke, whereby someone would submit another person’s phone number and address, but give an email account they had access to in order to activate the account. It was quite frequently that the person didn’t even know they were enrolled in anything, as evidenced by the usage rates of the services, which were in the low single digits.

    The biggest problem for the company that I worked for (other than counting the money…the subscription services brought in approx. $1.5 million per week gross) was managing complaints. Pretty much, any complaint would warrant a refund. The company wanted to satisfy all complaints before they were reported to state authorities and, most importantly, before they were reported to the phone companies themselves. Sure, the phone companies loved cashing in for their share of the pie, but they hated getting complaints. Too many complaints and they would revoke your right to bill on their numbers. The way that my employer managed the complaint numbers was by keeping an eye on which carriers were getting too many complaints. If the complaint rate got too high, we’d just modify the filter to turn down a higher percentage of people who applied for the subscription services for a particular phone carrier. If we accept fewer people from a particular carrier, then we’d get fewer complaints (the phone companies were more concerned with volume of calls than they were percentage of complaints.) Once the complaint numbers went down to an acceptable level, we’d edit the filters again and open the enrollment back up to previous levels for that carrier.

  7. Buran says:

    @davebg5: Now there’s a way to get back at someone who annoys you. I imagine that gets abused maliciously quite a bit. All I need to get back at someone is to find out what the Zip code is for their phone number (and it is easy to trace where area codes and exchanges are located) and sign them up for something. They’ll either lose money from bogus billing or have to deal with the hassle of cancelling.

    In other words I imagine this is hardly uncommon if I immediately thought of it.

    Hope you got out of there… that place sounds like a lawsuit waiting to happen

  8. mrjimbo19 says:

    Had the exact issue with Cingular as well. Charged me 9.99 for a web download when the phone had not been turned on for over a month (using a work phone and simply forwarding the calls). Called in and the rep asked a few questions about my usage on the phone. When I asked him to look up my usage and he did he put me on hold and reversed it and said he was sorry.

    I was ticked off because I normally just pay the bill and don’t look at it much but the amount seemed a little high so i looked it over this time. Good rule of thumb to have though.

  9. wring says:

    @davebg5: wow, i have no words.

    I’ve been a victim of this, 2 weeks into my newly activated tmobile account. i blame it on number recycling–i had a number with 00’s at the end and I thought I hit the jackpot. I sure as hell did! tmobile has been very good about it though, they credited every cent and gave me a new number for free.

  10. davebg5 says:

    @Buran: Yep…that’s exactly what would happen. People mad at neighbors, co-workers or the company that they worked for. Plus, as long as they entered an email that they had access to, they could use the services if they wanted to while the object of their malice got stuck with the bill.

    Often, people wouldn’t realize what was going on until they had been getting billed for months and racked up hundreds of dollars in charges.

    Oh yeah, I left that place almost a year ago. Don’t get me wrong, I’m no pillar of morality, but some things are just too much to bear day in and day out.

  11. timmus says:

    It’s really fascinating how when a company engages in thievery, everyone tolerates it and the practice perpetuates until litigation or market forces make it uneconomical. But if an individual tries this, then it’s fraud and the cops are unleashed right away.

  12. SOhp101 says:

    lol, this reminds me of those annoying commercials… TXT HOTCHICK to 46789!

  13. This happened on my home Verizon line. Verizon made me call the billing company, who in turn put me through to the shady company called “emailservices”. The indifferent, almost unintelligible, lady at the other end mumbled something about an error, asking if a certain address in the neighborhood was mine. Not only was it not mine, such an address doesn’t exist in my neighborhood at all.

    After I got the charges reversed, I called my phone provider and asked them to block all 3rd party billings.

  14. Bix says:

    FCC on Slamming: [www.fcc.gov]

    Once, when using a dial-around for my long distance, I got slammed by Sprint. The dial-around company said that while they may send calls to Sprint if their circuits are busy, Sprint should not be billing for them. The dial-around CSR told me that it would be best to not use their service until they told us to, and they never contacted us again.

  15. crimsonwhat says:

    I get calls about this all the time as an AT&T CSR.
    For the love of God, please read your bills thoroughly, as these calls are one of my biggest pet peeves.

  16. chimmike says:

    thing is, we didn’t subscribe to anything, we don’t click on those “get this free” bullsh!t deals, nothing. We merely make phone calls and text eachother……..so that $12.99 charge appeared like an unwanted baby at an orphanage.

  17. @davebg5: Thank you for that post, Dave. That’s almost an entire “Consumerist Confessions” story right there!

  18. ChristopherDavis says:

    I had a similar experience on my cell phone. I got a series of four text messages (of nothing more than the word “test”) from the same 5-digit number. I figured “fine, someone typoed their number in a web page form and didn’t catch it immediately” and ignored it once they stopped.

    Later, I saw four $2.99 charges on the bill for a “third party service”. When I called T-Mobile, they said that it wasn’t a charge from them and referred me to a company that turned out to be nothing more than a billing middleman for the real “service” provider.

    After getting no information out of the middleman, I disputed the charges with T-Mobile in writing (noting that I had not received any reply from the billing party), and they took them off without argument. If I’d still had problems, there was another option available; I pay the cell bill with a credit card, so I could have disputed the charge through them.