FREIDIN · DOBRINSKY is investigating Telmex phone cards with regard to potential undisclosed charges that may result in buyers of these phone cards getting less than the face value of the card and/or getting less than the advertised value of the card.
Business Week recently reported that the $4 billion prepaid phone card industry is under attack for marketing tactics which mislead consumers. Newark, N.J.-Based IDT Corp claims its prepaid phone competitors are marketing 100-minute prepaid cards but delivering a product that only delivers 60% of the time promised. IDT says this fraud is costing consumers more than $1 million a day.
Once considered novelties, phone cards have grown in popularity, especially among the most vulnerable - immigrants, the elderly, and low-income consumers, often because of their inability to obtain standard phone services. They are also used by travelers and students who travel abroad to keep in touch with their companies and families when they don't have long-distance phone service. Prepaid phone cards are also readily available in retail store, supermarkets pharmacies, convenience stores and gas stations.
Three companies (Epana Networks, Dollar Phone and Locus Telecommunications) have settled with IDT, but did not admit liability or make any payments. They only promised to change their misleading marketing. The remaining six companies are challenging the claims.
Consumer complaints have included:
- Unadvertised or ambiguous fees (maintenance, connection, or service charges) which can take 10 or more minutes off a card
- Unadvertised or ambiguous activation or set up fees
- Unadvertised or ambiguous call lengths (minimum time requirement per call, call under 1 minutes still charged 5 minutes)
- Unadvertised or ambiguous usage (one time use, multiple use, expirations dates, when does call actually start)
- Card issuer goes out of business
Today, only 11 states, including Florida, have laws regulating the marketing and selling of calling cards. The Federal Trade Communications, which has jurisdiction on the matter, has yet to institute stiffer enforcement, only offering tips on their website on how consumers can protect themselves.
If you or someone you know has been mislead by Telmex or another prepaid phone card company, you can contact an attorney at FREIDIN · DOBRINSKY here or by calling us at 1-866-495-8060. Our consumer fraud attorneys will answer your questions free of charge, and we are here to help.
