AG Lori Swanson sues Cheap2Dial for ripping off Minnesotans

Categories: Business

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Photo by samantha celera
Those phone bills are complicated.
Bargain long-distance phone carrier Cheap2Dial may soon be facing a heavy bill of its own: Attorney General Lori Swanson is suing the Pennsylvania company for charging Minnesota customers extra fees without their knowledge.

The company's customers thought they were getting a better deal on long distance at $.039 per minute, but Swanson says they were paying up to $15 a month in hidden costs.

Critics call Cheap2Dial's practice "cramming." This kind of thing is on the rise after, too, after subsiding in the 1990s because of government crackdowns. Swanson pointed to numbers from the FCC showing 6,714 cramming complaints in 2009, up from 1,761 in 2005.

U.S. Sen. Amy Klobuchar has been trying to curtail this kind of thing through FCC action. The lawsuit in Hennepin County District Court was announced jointly by Klobuchar and Swanson.

The fees weren't completely hidden, but Swanson and Klobuchar say that phone bills now are so complicated that most people are either not bothering or are too confused to parse the details and see where the extra fees are coming from.

Cheap2Dial has a small footprint in Minnesota, just 2,567 customers. And only nine of those actually used the company's services to make a long distance call. But Swanson said that when Cheap2Dial was asked by her office to verify that customers knowingly signed up for the company's services, it offered up a list of bad data: including incorrect names, emails, and birthdates.

Bottom line: Put in some quality time with your phone bill and figure out whether you're paying for services you don't need or want.

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