Phone Card Companies Faultily Serve Immigrants
Prepaid phone cards have come to popularity especially to Hispanic immigrants as a means of communicating with family from distant places. These breed of regular customers purchase prepaid cards out of the lack of financial and for others the legal means to avail of conventional phone service.
However many have complained of the unjust service they get from the cards that only give half of the indicated number of minutes that they supposedly paid for. They use the card by dialing an access number and then inputting the unique ID number indicated on each card.
Most of the immigrant customers have insufficient credit background to avail of discount international service. AT&T is too expensive for them with a full-price service that costs about $1.32 a minute to connect calls to major cities in Mexico. On the other hand, the Oye! card that?s marketed by Entrix Telecom Inc., an IDT subsidiary costs only $5 with an offer of "unlimited" minutes to similar Mexican areas. IDT vague terms of service has confused its customers in thinking that it has infinite number of minutes over a series of calls instead of what the card purportedly says that is only at least one conversation of any duration. Customers were caught off guard when their calls have been suddenly cut off due to consumed minutes they are not aware of. Suspicions of manipulation of the call minutes have risen against IDT.
There is also vagueness on the imposed variation of fees for phone card services. Companies reduce the value of cards by cutting at least 10 minutes depending on the amount paid by customers. These are what they call connection, service, or maintenance fees that are weakly indicated on the back of cards in indistinct print.
But these victimized consumers are now trapped between the legal battles of prepaid companies as new accusations of counterfeit marketing of cards arise. The battle on who?s to blame on the deceitful service to customers is set on a $4 billion industry. Its biggest player, holding $2.2 billion sales is Newark-based IDT Corp. whose IDT Telecom unit has filed suit in March against nine other telecommunication companies. IDT claims its rival companies have done fraud against consumers making them spend up to $1 million a day and that the other companies give only 60% of their supposed 100 call minutes.
Epana Networks, Dollar phone, and Locus Telecommunications have settled with IDT and are putting an end to any fraudulent marketing they may have used. Yet they denied any liability and made no payments. The six remaining accused IDT competitors are throwing it back at their accuser. Great Neck-based CVT Prepaid Solutions Inc. stated in an open letter addressed to the industry last March 19 that IDT?s allegations are merely a strategy of intimidation to recoup lost shares in the market. CVT Co-Chairman Richard R. Roscitt says that IDT wants to share the blame that was put on them by consumers in January when they shelled out $20 million in refunds. He adds that it is likely that IDT wants to dominate the industry through its allegations.
IDT?s founder and Chairman Howard S. Jonas says Roscitt is acting out of ?moral outrage.?
Federal Trade Commission?s assistant director Lisa Hone says that they have been communicating with Hispanics throughout the country and have gathered a considerably large amount of complaints on deceptive services from the prepaid calling industry. They will soon implement stringent enforcement to protect consumers.
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