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AOL Embarrassed by CNBC Report On Its Business Practices

By Joe Benton
ConsumerAffairs.com

June 21, 2006

AOL/America Online • AOL Pays $3 Million, Promises to Clean Up Cancellation Process • AOL Settles Florida Fraud Charges • AntiSpyware Group Targets AOL Release As Dangerous • AOL Heads Roll Over Data Leak • AOL Now Free ... Sort Of • AOL Takes More Hits In Press, On Internet • AOL's Problems Worsen as Consumer Complaints Mount • AOL Embarrassed by CNBC Report On Its Business Practices • E-Mail Taxation Without Representation • AOL, Yahoo Planning Postage Charges for Email • AOL Settles With NY, Agrees to Clean Up Cancellation Process • Ohio Settles Lawsuit With AOL • AOL Abandons Broadband • Ohio Latest to Sue AOL • AOL Loses 2 Million Clients, Faces Subpoenas • Class Action Accuses AOL of Double-Billing Scheme • AOL Offers to Settle Federal Charges --- Consumer Complaints • Cancellation Difficulties • Double-billing • "Free" Hours • Unauthorized Charges • Shop-Direct Complaints • Tech Support

Consumers are dropping AOL by the thousands. More than 800,000 people in the last quarter turned off the online service provider. But for many who would like to be former subscribers, AOL is becoming the pest that refuses to go away, even after repeatedly being told it is no longer wanted or needed.

Terri of Beaver Dam, Wisconsin, is one of nearly 4,000 consumers who have written to ConsumerAffairs.com in recent years about problems with AOL.

"Trying to cancel AOL during the free three-month trial is a nightmare. They continued to bill my account and credited it only when threatened," she said. Two months after the account was supposed to be canceled, "there's another unauthorized payment," she said.

Doris in New Jersey reports a similar problem with her disabled son's account.

"My son, who has Autism, had an AOL account. I cancelled it for him in October, 2005, by phone," she told us.

"In April 2006, while checking over his credit card bills, I noted he was still being billed. I called AOL again. The process took at least two hours to get to a live person who advised me he would cancel and I had to write a letter asking for refund."

Doris is still having trouble getting AOL out of her son's life.

"An audit of our checking account showed that AOL has withdrawn from our checking account twice a month $30.92. Who can we contact to prevent this from happening, again?"

Vincent Ferrari recorded his conversations with AOL when he tried to cancel his account and gave the conversation to CNBC. The exchange went like this:

AOL: Hi, this is John at AOL. How may I help you today?
Ferrari: I want to cancel my account.
AOL: OK. I mean, is there a problem with the software itself?
Ferrari: No. I don't use it. I don't need it. I don't want it.
AOL: Last year, last month it was 545 hours of usage.
Ferrari: I don't know how to make it any clearer. So I'm just gonna say it one last time. Cancel the account.
AOL: Well, explain to me what is wrong.
Ferrari: I'm not explaining anything to you. Cancel the account.

The conversation continued for another 5 minutes, ending with ...

Ferrari: Cancel my account. Cancel the account. Cancel the account.

At that point, the AOL representative asked to speak to Ferrari's father as a last resort even though the former AOL subscriber is 30 years old.

"I came very close to losing it at that point," said Ferrari.

That is a conversation that thousands of people report having with AOL representatives but finally, as a result of bad publicity on the important cable television business channel after the Ferrari incident, AOL issued an apology.

"At AOL, we have zero tolerance for customer care incidents like this -- which is deeply regrettable and also absolutely inexcusable," said AOL spokesman Nicholas Graham. "The employee in question violated our customer service guidelines and practices, and everything that AOL believes to be important in customer care," he said.

However, the thousands of complaints to ConsumerAffairs.com suggest that Ferrari's experience is far from an isolated incident. Many consumers have suggested that AOL policy is to delay cancellations as long as possible. Double billing, cancellation difficulties free trials that aren't free and unauthorized credit card charges are common practice, according to our readers.

"I am being billed monthly by 2 different departments of AOL. They have permission to take only $14.95 monthly. They are debiting my account at will," Timothy wrote from Columbia, Missouri. "I called and complained and now I'm being billed weekly," he said.

While Timothy has asked for his money back from AOL, no refunds have arrived. He says AOL has offered lots of promises but the company still owes him about $200.

AOL insists they have "strong safeguards" in place to prevent customer abuse and plan to continue "maintaining rigorous internal and external compliance methods."

The AOL safeguards seem to be breaking down though, at least according to the people taking the time to write to us about their problems with AOL.

Lynne in Chicago put it this way: "I recently started reconciling my bank statements from 2005, when I noticed that AOL had started back to taking their monthly fee out of my bank account. Different amounts, some months $25.90 plus $3.95 and other months $23.90.

"I cancelled AOL in April 2005," she told us.

Company spokesman Nicholas Graham promises that AOL is "going to learn from this -- and continue to make the necessary, positive changes to our practices. This was an aberration and a mistake, and we have to manage these incidents down to zero as best we can."

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