July 28, 1991|By Arlene Ehrlich
Even so, phone companies insist that most of those horror stories are just that -- stories. According to Jeanine Smetana, spokeswoman for C&P, "We'll work with the customer if he or she complains that the 900 or 976 charges were unauthorized. Generally, if a large bill results from a child calling one of these numbers, we will make a one-time adjustment in the customer's bill."
"Besides," she adds, "we do have a blocking service available for people who don't necessarily have complete control over who uses their phone. There's a $16 service charge, just as there is any time a customer wants to make a change in service, and then there's a one-time charge of $11 to block access to 900 numbers and a $4.50 charge to block access to 976 and 915 exchanges. The blocking service is free if it's requested as part of an order for new telephone service."
More often than not, however, parents are surprised by large bills that they did authorize, albeit inadvertently. Parents often give blanket permission for teen-agers to call chat lines or rock star fan lines without looking closely at the cost. Or parents show young children how to dial Santa Claus or the Easter Bunny or Teenage Mutant Ninja Turtles. Usually the cost is low -- on the order of 25 cents to 50 cents a call. But a very young child may be so enchanted that he or she will call several times a day for weeks on end, without the parents' knowledge.
What disturbs consumer advocates more than the prospect of children running up large bills is the industry's appeal to scam artists of every ilk. As The Evening Sun reported last month, widespread fraud and abuse -- from phony job come-ons to fake sweepstakes and contests, to schemes that target people desperate for credit or loans -- characterize a significant minority of audiotex providers.
According to the Alliance Against Fraud in Telemarketing -- a coalition of 81 consumer groups coordinated by the National Consumers League -- pay-per-call frauds are directly tied to the national economic slump. "We'd like consumers to know that you can't get your credit repaired over the phone," says Linda Golodner, chairman of the alliance. "Con artists for whom the telephone is the weapon of choice have cooked up ingenious and effective appeals that play on widespread fears about unemployment, bad credit and a tight loan market."
Nor is all the fraud tied to temporary economic conditions. "We see abuses in 900 numbers as a new trend in fraudulent telemarketers," says Eileen Harrington of the Federal Communications Commission's Bureau of Consumer Protection. In fact, the FCC has received more than 2,000 complaints -- 800 of them in the past year alone -- about alleged fraud in the pay-per-call industry.
U.S. Sen. John McCain, R-Ariz., who introduced legislation last spring to regulate audiotex suppliers, adds, "It's a billion-dollar industry with virtually no consumer protection and, to a great extent, has become the home to many scam artists who are recycling all the old types of scams with this new technology. I'm particularly concerned that it's playing on the most vulnerable in our society -- those in need of credit or jobs, the lonely and children."
Service-bureau owner Brooks McCarty believes the industry has gone far in the last few years to improve its image. "First of all," he says, "you have to remember that the dating services and adult entertainment lines are not [long-distance] numbers. Local telephone companies are monopolies, and they can't discriminate among their customers. If someone wants to start a phone dating service or gambling line or sex-talk line, the phone company can't refuse to do business with them."
"With the national carriers like AT&T, Sprint, etc., it's a different story. They're free to turn down certain kinds of businesses, and they do." In fact, not one of the four major long-distance carriers will do business right now with the "adult" phone services.
"Overall," he says, "the trend in the business is toward greater responsibility and respectability. The demographics of our callers are changing, and the industry has gone far toward cleaning itself up."
Industry studies support the notion of changing demographics. Strategic Telemedia, a New York-based telemarketing consulting firm, found that the heaviest users tend to be phone freaks and computer hackers -- people for whom telecommunications innovations are mother's milk. In 1990, Telemedia found that among the 7 percent of all Americans who had dialed a 900 number at least once, a hefty majority were professional males with incomes averaging $25,000 to $50,000.
"It may seem paradoxical," says Mark Plakias, a senior vice president at Strategic Telemedia, "but people who call 900 numbers tend to be better educated. They're information junkies. The just don't look at 900 numbers as a paid call. They see it as an information service."
