FCC Wants to Fine Telecom Companies $29M for Scams Targeting Latinos in Puerto Rico, Nevada and Latin America
Part of the Federal Communications Commission's job is to police telecommunications companies against defrauding and scamming customers. Now the FCC is proposing a big fine against four interrelated telecoms that have been accused of "slamming and cramming" their customers, reportedly targeting Latinos with the scam techniques.
This week, the FCC called out OneLink Communications, TeleDias Communications, TeleUno and Cytel after receiving over 140 complaints from consumers about deceptive and fraudulent practices. The commission is proposing to fine the four long-distance service providers -- which industry journal RCRWireless noted are all interrelated, though they operate separately -- to the tune of over $29 million.
Scamming Latinos
The FCC says the providers targeted "consumers with Hispanic surnames" with a double-edged scam technique known as "slamming and cramming." Slamming is the act of changing customers' service without permission, often without notification, while cramming is when a service provider adds unauthorized charges to a customer's bill.
Latinos have been long been the targets of these scams. As early as 2004, the Federal Trade Commission released a report on consumer fraud that found that Latinos were "the only group that shows a significantly higher risk of being slammed.
The data suggested that Latinos who primarily speak Spanish were more likely to be victims, as they're perceived to be more likely need long-distance service to communicate with family and friends abroad and more easily manipulated. But the report also showed that Latinos in general tended to be victimized by slamming and cramming regardless of English proficiency. The four companies accused of scamming Latinos operate in big Latino markets, including Puerto Rico, Nevada and countries in Latin America.
While slamming and cramming are anti-consumer actions that the FCC has enthusiastically policed before -- Sprint and AT&T mobility, for example, were charged approximately $100 million in 2014 for cramming schemes -- the alleged scamming in this case went beyond being consumer unfriendly.
Fraud Beyond Billing Scams
The FCC says the companies not only added unauthorized charges to customers' bills, they went out of their way to lie to the agency. According to the FCC's release, "It is alleged the companies, which operate as a single enterprise, fabricated audio recordings that they then submitted to the FCC as 'proof' the consumers authorized these changes and charges."
Consumers filing complaints also said the companies' telemarketers tried to manipulate them with even more fraudulent tactics. Telemarketers pretended to be from the post office calling about "a nonexistent package delivery" in order to create fake recordings of consumers' purported "authorization" for charges.
At other times, the companies seemingly impersonated individual customers in recordings, handing them to the FCC in response to its investigation into consumer complaints -- which violates federal laws against providing false and misleading information to federal investigators.
"Charging consumers for services they did not want or authorize is simply unacceptable," said Enforcement Bureau Chief Travis LeBlanc in the FCC's release. "We are committed to combating slamming and cramming because these unjust and unreasonable practices result in consumers paying for services they never requested or received, and spending their time trying to reverse unauthorized carrier charges."
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