Federal and state officials told a Senate panel complaints about abuses of 900 telephone numbers continue to climb in direct proportion to the burgeoning growth of the $1 billion pay-per-call industry.
Overcharging, failure to disclose the cost of calls, come-ons aimed at children and outright fraud are among the most frequent consumer complaints about 900 numbers, according to officials who testified Tuesday before the communications panel of the Senate Committee on Commerce Science and Transportation."Complaints regarding 900 pay-per-call service currently comprise the biggest area of consumer complaint" to the Federal Communications Commission, FCC enforcment division chief Mary Beth Richards told the subcommittee.
"Last month we received 309 complaints regarding 900 service, which represents 30 percent of the written consumer complaints the commission recieved on all telecommunications issues," Richards said.
"In recent years, the use of 900 calls has skyrocketed and so have the complaints," said Sen. Daniel Inouye, D-Hawaii, chairman of the subcommittee.
Inouye, whose proposed legislation to curb the abuses was a subject of the panel's hearing, noted studies showing 900 numbers are "one of the most frequent vehicles of consumer fraud in recent history."
South Dakota Public Utilities Commissioner Laska Schoenfelder said in her sparsely populated state complaints about 900 number abuses have risen from six in all of 1988 to 48 so far in 1991.
During that same time period, according to the Federal Trade Commission, the industry has grown from 233 information providers in 1988 to an estimated 14,000 currently. Industry revenue for 1990 is estimated at $1 billion.
Commonly, callers to legitimate 900 numbers are provided entertainment or information, such as weather or sports news, on a pay-per-call basis. But scams and abuses, such as charging exhorbitant fees for useless information while failing to inform callers of the cost, have proliferated.
Consumer groups also have complained about easy access to sex lines by children and ads designed to lure young children to call 900 numbers to hear messages from cartoon characters or rock stars.
Legislation offered by Inouye and Sen. John McCain, R-Ariz., would require that 900 services provide a "preamble" stating the cost of the call and giving callers the option to hang up without charge. The bills also would impose restrictions on 900 number ads aimed at children and would require phone companies to provide customers with the name and address of 900 services, as well as allow customers to block 900 number use from their phones.
Richards said the FCC has already proposed regulations requiring a preamble and service provider identification, but she said requiring phone companies to provide blocking services to individual customers may not be technologically feasible in some areas of the country.