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STUDY | Per minute cost 87% higher than advertised
MIAMI They can be seen hanging behind
the counter at the minimart, those brightly
colored phone cards for calling Latin
America, Africa and Asia. Often, they are
the only reliable way for immigrants to stay
in touch with their families.
But many buyers are being ripped off to
the tune of millions of dollars a year.
Some cards fail to deliver the promised
minutes. Others tack on confusing fees that
may not be listed in the microscopic print
on the back of the card. Still others round
up each call to the nearest threeminute
mark.
Sometimes they give you all the
minutes. Sometimes they dont. Then you have
to switch to a new card, said Augusto
Revolorio, a Miami Beach grocery stocker. He
buys the $2 or $5 cards regularly to call
his mother and four brothers in Guatemala.
It costs me more to complain on the phone
and be late for work, so I just rip up the
card and buy a new one.
A 2004 study led by University of Georgia
economics professor emeritus Julia Marlowe
found that the costperminute rates for
prepaid calling cards were on average 87
percent higher than those advertised.
Because many immigrants like Revolorio
dont have time or are afraid to go to
authorities to complain and the money
they lose per card is small little has
been done to crack down.
Every time I check, the
telecommunications industry is a highly
regulated industry. This one they dont want
to regulate, said Gus West, head of the
nonprofit Hispanic Institute in Washington,
D.C.
Thats starting to change. In the last
year, attorneys general in Florida,
California and several other states have
begun to take a closer look at the phone
card industry, as has the Federal Trade
Commission. In October, Rep. Eliot Engel (DN.Y.)
introduced legislation to regulate the
business.
Engels bill would require standardized
disclosures of all charges on the back of
the card or in ads, ensure companies provide
promised minutes and prohibit charges for
unconnected calls.
The push comes partly from an unlikely
source communications giant IDT Corp. The
Newark, N.J., company settled its own
decadelong classaction lawsuit in January
over allegations it failed to disclose its
charges adequately. Now, it is leading the
call for regulation at the state and federal
level.
The most popular cards among immigrants
and the ones least likely to deliver
promised minutes are those offering super
cheap rates to countries such as Mexico,
Guatemala, Haiti and India.
Norbert Dominguez of Miami said he buys
about six $10 cards a month to stay in touch
with his mother and 4yearold daughter in
Cuba. Each card promises 18 minutes but
usually delivers closer to 12, he said.
Thats an actual cost of about 83 cents a
minute, vs. the promised 55 cents. Still, it
is cheaper than the typical longdistance
telephone rate of $1.15 a minute.
Its the cheapest way to call because
other ways are very expensive, but in the
end, theyre still swindling us, Dominguez
said.
Dominguez said he has complained with
little success. They give you a customer
service rep, but its never someone with
authority, he said. AP
Source: http://www.suntimes.com/news/nation/644508,CSTNWScall11.article
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