Consumers reach out, slam long-distance swap

October 18, 1990|By Susan Hansen | Susan Hansen,Washington Bureau of The Sun

WASHINGTON -- Louise Simmons had answered the calls from the long-distance phone carriers who wanted her business. And after hearing their sales pitches and repeatedly declining their services, the West Virginia schoolteacher thought she had made her preferences clear.

But last winter, when she tried to use a calling card to phone her daughter in Los Angeles, she found out a new company was now handling her long-distance calls.

"I was astonished to learn that I was being billed by that company," she told a House subcommittee yesterday. "I was a customer of MCI whether I wanted to be or not."

Ms. Simmons had been "slammed."

Slamming works like this: a consumer receives a call from a telemarketer trying to sell the services of another long-distance carrier. The consumer declines to sign up with the other carrier but discovers the following month when his phone bill arrives that he was switched anyway.

Part of the problem of catching slamming is that, under current regulations, long-distance companies don't need a formal notification to switch customers. An oral approval by a consumer is sufficient.

Slamming has grown at an alarming rate in the past year and continues to spread, witnesses told a House Government Operations subcommittee yesterday.

As many as 80,000 people in Maryland and six other mid-Atlantic states could fall victim to slamming this year, said James R. Young, a Bell Atlantic official, adding that many will not even realize it has happened.

The practice appears to have first attracted the notice of state and federal regulatory officials in 1988. Since January of this year, said Richard Firestone of the Federal Communications Commission, about 1,800 long-distance customers have filed complaints. Most of the problems involved MCI, said Mr. Firestone, who did not offer a specific breakdown but added that complaints also were lodged against American Telephone & Telegraph Co., US Sprint and other smaller carriers.

Eugene Eidenberg, MCI executive vice president, acknowledged that his company had received customer complaints but attributed the problems to honest foul-ups or clerical errors on the part of local phone companies. "It is not MCI's policy, nor is [slamming] in our business interest," he said. "It's a public relations disaster."

He and representatives of other long-distance companies agreed that the practice must be halted but disagreed on a specific remedy.

AT&T -- which claims that about 20 percent of its former customers who switched to a new long-distance carrier were slammed -- has asked the FCC to require long-distance companies to get customer authorization in writing before allowing local phone companies to carry out the switch.

AT&T also filed a federal lawsuit in January charging MCI with unfair and deceptive telemarketing practices, and with widespread switching of long-distance customers without their consent.

But Mr. Eidenberg said AT&T's proposal would favor AT&T -- which holds 70 percent of the long-distance market -- because many people who do want a new carrier would not take the time to send written authorization.

The FCC's Mr. Firestone said his agency currently is reviewing several options to halt slamming and is likely to issue new rules pertaining to long-distance telemarketing.

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