Fee Alert: Have You Been the Victim of Phone Bill ‘Cramming’?

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You might be paying $14.95 a month for “enhanced voice mail” or some other service that’s totally unnecessary, that you never purposefully signed up for, and that you simply don’t want.

The Boston Globe reports on the rise of “cramming,” the shady practice in which a company sneaks some unwanted fee onto a customer’s bill. Phone bills are particularly ripe for cramming, since they are typically filled with countless taxes, surcharges, and fees, and indecipherable “explanations” that follow. The story cites the example of a gentleman named Mike Cunningham, who unknowingly paid $567 to two companies he never heard of, for services he never used:

In recent years, state and federal agencies have been receiving an increasing number of complaints similar to Cunningham’s. Since, 2005, cramming has been one of the top consumer questions about telecommunications fielded by the FCC, as concerned customers try to figure out mysterious charges on their phone bills. The agency received more than 9,000 inquiries in 2008, and 1,300 in the first quarter of 2009, the most recent data available. That compares with 1,761 for all of 2005.

Phone companies are allowed to bill customers for legitimate services offered by outside parties, but it’s a complicated setup. Such charges are often administered by third-party firms, such as ILD Teleservices, which are hired to process billing for the companies that provide add-on services like enhanced voice mail. Major phone carriers, including Verizon Wireless and AT&T, enter into contracts with those companies and billing agencies, which, in turn, pay the phone carriers a fee.

Neither Verizon Wireless nor AT&T would disclose how much it profits from such arrangements. Both said they encourage customers to scrutinize their bills to make sure they are not being improperly charged for services.

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