Montana News

FTC wants to shut down Missoula-based phone 'cramming' operation

Posted: Jan 23, 2013 10:27 AM by Dennis Bragg - MTN News

MISSOULA - The Federal Trade Commission is asking a federal judge to shut down a Missoula company that it claims has bilked consumers out of $70 million in bogus charges to their phone bills.

The process, known as phone "cramming," involves companies that charge people for services they didn't authorize, never ordered or may not even known they had.

The complaint filed January 8 has FTC investigators in Seattle accusing Steven Sann and three other people of "causing recurring charges" to appear on people's phone bills that were "neither requested nor authorized."

The FTC says those services include voice mail, electronic fax services or "other noncall-related services."

The FTC claims Sann, and Terry D. Lane, both from Stevensville, and Nathan Sann and Robert Braach, both from Missoula, have been operating a series of companies with addresses in Missoula, as well as Henderson, Nevada, since January 2008.

Those firms include American eVoice, Emerica Media, FoneRight, GVM, HearYou2, Network Assurance, SecuratDat, Techmax,and VMP.

The federal investigators claim the group would transmit the charges to "billing aggregators" who would then pass along the charges to customers of phone companies such as Verizon, AT&T, and Frontier.

The FTC says the charges, which would typically appear on the last page of a multi-page phone bill, ranged from $9.95 to $24.95 a month, totaling about $70 million.

The FTC also claims the group took its proceeds and ran them through a non-profit corporation.

Commission investigators are accusing the group of three counts of violating the FTC Act and are asking U.S. District Court Judge Dana Christensen to issue an injunction to stop the company and seek damages.

The defendants are asking the judge to order a stay in the case, saying there is "no urgent need" for an injunction since the alleged violations have already stopped, and can't resume because of billing reforms in the telecommunications industry.

Sann's attorneys also argue the same accusations are already part of an active criminal investigation the federal agencies have been pursuing for several months.