Unscrupulous long distance providers continue the practice of "slamming," even though it's illegal. Not content to harass consumers by switching their long-distance service without telling them, some companies have been preying on small businesses as well.
Illinois Attorney General Lisa Madigan has filed suit against a Michigan company for allegedly "slamming" more than 20 small businesses across her state.
In the suit, Madigan charges that LCR Telecommunications, LLC has perpetrated a classic telephone "slamming" scheme. During its investigation of individual complaints, Madigan's office uncovered the fraudulent telephone slamming scheme that has hit small businesses in at least 11 Illinois counties.
Madigan says telephone slamming deprives consumers of their right to choose a long distance telephone rate plan and often forces the consumer to pay increased long distance costs and carrier switch fees. Consumers also must spend time investigating and undoing the switch.
Her suit also alleges that the company provided her office with falsified proof of authorization, attempting to cover up its fraudulent activities passing off long distance switches as having been approved by employees who, in several cases, didn't even work at a victimized business.
"Slamming is inconvenient, expensive and illegal," Madigan said. "Small businesses have enough work to do without trying to fight fraudulent activities. My office will seek to ensure that this company pays for the time and trouble these companies have had to spend dealing with this billing nightmare."
Madigan's office has received 22 complaints against LCR from small businesses in Champaign, Cook, Douglas, Jefferson, Macon, McLean, Moultrie, St. Clair, Tazewell, Vermilion and Woodford Counties. The businesses allege they were billed by LCR but deny ever having authorized the company to be their long distance carrier.
Madigan's suit charges LCR with violations of the Illinois Consumer Fraud and Deceptive Business Practices Act by switching companies' telecommunications service without proper authorization and then trying to cover up the fraud.
LCR allegedly provided Madigan's office with proof of authorization for the long distance telephone service switches. The proof included the name, title and birth date of the person who provided the authorization or an audio recording of a telephone conversation authorizing the switch. Madigan said that in numerous cases, the person named was not an employee of the company, the information about the person is inaccurate or the voice on the recording does not match the voice of the person who supposedly authorized the call.
Madigan's suit seeks to prohibit LCR from slamming consumers in Illinois. Additionally, it seeks restitution for LCR's customers, civil penalties of up to $50,000 and up to $50,000 for each violation found to have been committed with the intent to defraud. LCR, a long distance telecommunications service resale company, has been authorized to provide service in Illinois since November of 2002.
According to a recent Federal Trade Commission survey, "Consumer Fraud in the United States," 6.5 percent of the U.S. population has fallen victim to telephone slamming schemes. Madigan's office has brought 29 slamming enforcement actions since 1995.
To help prevent telephone slamming, Madigan suggested that consumers check their telephone bills carefully to see if their long distance carrier has changed; look for hidden charges on their telephone bills or unexpected fees for a provider switch; and put a PIC Freeze on their telephone lines. A PIC Freeze form can be obtained from the consumer's local telephone company and instructs the telephone company not to change the consumer's long distance carrier without proper authorization.