For Immediate Release	CONTACT:	Holly Anderson
7/29/99		(202) 835-3323

Cramming is Down, But Not Out

     WASHINGTON, DC . . . "Cramming," the number one complaint reported to the National Consumers League's National Fraud Information Center in 1998, has fallen to number two in the first six months of 1999. Cramming complaints have dropped from an average of 228 per month in 1998 to 60 per month in 1999, a 74 percent decrease. "We have spoken to several telephone companies that bill on behalf of third-party vendors for miscellaneous services and they also report that the volume of cramming complaints is going down," said Susan Grant, NFIC Director. "It's still too early to declare victory, but it looks like crammers are on the run."

     In July 1998, telephone industry representatives announced that they had developed voluntary anti-cramming guidelines to give consumers more protections and to make it harder for third-party vendors to abuse the billing system.

     Grant noted that while the guidelines have been adopted by all of the major telephone billing companies during the past year, each company is free to determine its own policies and procedures. For instance, some companies have set specific thresholds for the number of complaints that will cause billing to be suspended or terminated, while others use a case-by-case approach. Furthermore, the time period that companies have been tracking cramming and the criteria they use for counting complaints varies widely. Some companies record all complaints about miscellaneous service charges as cramming, and others only count the complaints if consumers are unable to resolve the problems directly with the vendors and need further assistance.

     "These differences make it hard to compare what each company is doing and gauge its effectiveness in combating cramming," said Grant. "While there is no clear model for success, we urge the telephone companies to keep the pressure on crammers who abuse their billing systems and to make it easy for consumers to get these fraudulent charges off their bills." She applauded Bell Atlantic and Bell South for their consumer-friendly policies of removing disputed charges immediately and also cited Bell Atlantic, GTE and Ameritech for offering optional blocking which prevents bills for third-party vendors' services unless consumers contact the telephone companies directly to lift the block.

The top ten telemarketing frauds reported to the NFIC for the first six months of 1999 are:

1.  Work-at-Home Plans—kits sold with false promises of profits

2.  Telephone Cramming—billing consumers for optional services they never ordered

3.  Advance Fee Loans—empty promises of loans requiring payment of fees in advance

4.  Prize Offers/Sweepstakes—phony prize awards requiring payment of fees first

5.  Telephone Slamming—consumers’ phone service is switched without their knowledge or consent

6.  Magazine Sales—fake sales or renewals for magazine subscriptions that are never received

7.  Travel/Vacation Offers—offers of free trips or discount travel that never materialize

8.  Credit Card Offers—phony promises of credit cards requiring payment of fees in advance

9.  Investments—stocks and other investments that don’t pan out as promised

10.Credit Card Loss Protection Plans—unnecessary insurance sold using scare tactics or misrepresentations

The National Consumers League, founded in 1899, is America's pioneer consumer organization. NCL's three-pronged approach of research, education and advocacy has made it an effective representative and source of information for consumers and workers. NCL is a private, nonprofit membership organization dedicated to representing consumers on issues of concern.