Testimony on bill-fixing catches top lobbyist’s eye
By: Sue Kramer
Telecommunications consumer advocate Thomas Allibone has attracted the aid of the Ralph Nader organization in the West Amwell resident’s long-standing fight against billing practices of Verizon Communications.
The Nader organization will start an investigation of the billing practices which Mr. Allibone called "a national billing scandal … bigger than Watergate."
The Nader organization is not only listening to Mr. Allibone, but two of Mr. Nader’s top advisers and consumer advocate attorneys, Carl Mayer and Bruce Afran, are working with Mr. Allibone to come up with a plan of action.
"Tom Allibone’s allegations about doubling billing, false billing and fraud in Verizon’s system are being studied by my organization, and I expect to make a public statement on these issues before the close of this campaign," Mr. Afran told The Beacon Monday.
Mr. Afran, in addition to working with Mr. Nader on his presidential campaign, is himself in the middle of a bid for a seat in the U.S. Senate on the Green Party ticket.
"I have been extremely impressed with Tom Allibone’s research and resourcefulness and his personal commitment to rooting out fraud at Verizon," Mr. Afran said. "In particular, Tom has been among the more active consumer advocates in fighting the Verizon rate increase, which would penalize elderly, lower income and disabled phone subscribers.
"By insisting on bundling together multiple services that consumers have not ordered as a pretext for raising rates, Verizon is abusing its monopoly position. The BPU must reject this increase as a gross abuse of Verizon’s position and an affront to consumers. If consumers have not chosen to voluntarily buy these bundled services, Verizon should not force these in the guise of a rate increase. We must preserve New Jersey’s low basic rate, the lowest in the nation, as a fundamental right of consumers."
Also working closely with Mr. Allibone and Mr. Afran is Susan Deckert, the Nader organization representative who is organizing support for the Verizon investigation campaign.
"This is another example of the national climate of consumer abuse," Ms. Deckert said. "It is unfortunately another example of another national trend of exploitation based on caveat emptor (let the buyer beware)."
The pending investigation stemmed from Mr. Allibone’s Sept. 25 testimony before the Board of Public Utilities in Trenton. The board is hearing testimony both for and against Verizon’s request to raise basic telephone rates Jan. 1. If Verizon can prove there is fair competition between telecommunications providers in New Jersey, it will be able to offer long-distance phone service and charge the higher deregulated rates for basic telephone services.
Mr. Allibone’s testimony regarding Verizon’s petition struck a nerve with the Green Party. Also testifying that day was Ms. Deckert. While she was there to testify against the Verizon petition on behalf of the disabled community, Mr. Allibone’s testimony caught her attention.
Ms. Deckert, who is running for Mercer County Freeholder on the Green Party ticket, took her concerns about Mr. Allibone’s testimony to fellow Green Party members Mr. Mayer and Bruce Afran, who are consumer advocate attorneys and also part of Mr. Nader’s inner circle of personal advisors and part of his legal team.
Mr. Allibone met with Mr. Nader Oct. 15 in Princeton. Mr. Nader took time from his campaign to briefly discuss the Verizon issue with Mr. Allibone.
"After more than five years of trying to get a response from the NJBPU and New Jersey attorney general to launch an investigation into the BANJ/Verizon illegal practice of removing overcharges from customer’s phone bills and not paying refunds for past charges, the consumers of New Jersey may finally be heard," Mr. Allibone said.
"In this case, had I not testified in Trenton, I would not have met Susan Deckert. At the time, I did not know her or know that she was in the audience listening to my testimony. It was her call to action that prompted her to take the highlights of my testimony to Ralph Nader campaign advisor Bruce Afran. Bruce is a prominent Princeton attorney and legal advisor to Ralph Nader. Ralph Nader had already known of many consumer abuses relating to telephone companies on selecting long distance calling plans and the benefits of sub-minute billing. I believe that my findings of hidden charges lumped under ‘monthly service’ is a new area of concern."
Mr. Allibone said of Bruce Afran, "He is highly respected in the legal community and is part of the Nader inner circle. Until Bruce completes his review, he doesn’t know what course of action will be taken. Some of the possible actions range from a class-action lawsuit on behalf of Verizon’s New Jersey customers to the exertion of political pressure on Verizon.
"My personal view on this is that we have a consumer fraud case, and that a legal remedy should be pursued," Mr. Allibone said. "I am supported in my efforts and allegations of fraud by other consumer groups. The largest group is the Consumer Federation of America. I often quote their numbers in press releases because they are compelling and fully substantiated."
The Consumer Federation of America published a report titled "Divestiture Plus Eight," which showed the Bell monopoly was abusing consumers in every region of the country, he said.
"I personally have worked in California, Texas, Pennsylvania, Maryland, Washington, D.C., New York and Massachusetts," Mr. Allibone added. "They are all similar to New Jersey. This is a national billing scandal. I will need the power and support of the Nader organization to clean up these states."
Ms. Deckert said, "This is an issue that will get priority attention. Mr. Nader has identified a number of things like this including hidden costs in hospital bills and inaccurate pricing of items showing up on supermarket checkouts. This (the Verizon issue) is just another example of consumer abuse by a corporation."
According to Mr. Allibone, Bell Atlantic-New Jersey started destroying valuable customer service records in 1994 to cover up massive overcharges on customer’s phone bills. Prior to this policy change, records were maintained for six years. Overcharges on New Jersey consumer phone bills could exceed $200 million annually based upon audits performed by LTC Consulting. Mr. Allibone is the founder and president of LTC Consulting.
In his Sept. 25 testimony, Mr. Allibone said, "Rather than fix the problems, they (Verizon) have cleverly insulated the company from liability by destroying customer service records prematurely. This is the only document that provides a complete itemization of monthly service charges and is a valuable consumer tool that can be used to track account activity such as adding or deleting services. It also provides the service order number that was issued as well as the installation date."
He added, "Until just a few years ago, Bell Atlantic (now Verizon) used to maintain customer service records for six years but has chosen to destroy these valuable customer records after 18 months. When I discovered this practice, I filed a complaint with the New Jersey attorney general (Aug. 7, 1995) and with this board on Dec. 11, 1995. At that time, LTC Consulting also discovered that Bell Atlantic had a policy of routinely ‘fixing’ bills.’ In essence, BANJ (Bell Atlantic New Jersey) quietly and discreetly reviews a customer’s billing record, known as a ‘CSR’ and removes overcharges from the phone bill without notifying the customer or offering a refund for past overcharges."
Mr. Allibone also presented the board with three cases to illustrate his point. One was a case where a company was being charged for a phone line that had been disconnected for six years. Rather than reimbursing the company for the charge, Bell Atlantic attempted a cover-up by issuing a new customer service record in which the overcharges had been removed as though they never existed, he said.
"I think I finally got my day in court, and the NJBPU was finally paying attention," he said the following day. "NJ101.5 picked up on my testimony. I also scored very well with the seniors – a number of them, representing senior citizen groups, expressed interest in meeting with me."
In an official statement dated Aug. 16, the BPU said, "At the time the board renders its decisions on these proceedings the two key issues that will be addressed will be the basic telephone rate for Verizon’s customers beginning on Jan. 1, 2001, and the cost to telephone competitors to lease parts of the Verizon network to provide basic telephone service, local toll and long-distance toll services to their own customers."
Verizon President Denis Bone defended his company’s position Tuesday by testifying the sale of premium services help offset the losses the company experiences with the current $8.19 basic rate. He also said the rate change is designed to encourage competitors to enter the local service telecommunications market in New Jersey.
Verizon’s opponents and consumer advocates say Verizon’s wire-leasing prices are too high and, therefore, discourage other service providers from entering the local phone service market in New Jersey, thereby eliminating competition.
The issue of fair competition and consumer rights across telephone service providers stems from the forced breakup of AT&T in 1984. At that time, it was ruled AT&T held a monopoly on telephone services, and the company was ordered to split into several different companies to promote fair competition.
One of the offshoots of the breakup was Bell Atlantic, a company that provided local and regional calling services on parts of the East Coast, including Lambertville and the surrounding area. Bell Atlantic subsequently bought its sister company, NYNEX, and then merged with GTE, forming a new company named Verizon.
Verizon boasts at its Web site, "Verizon companies are the largest providers of wireline (conventional telephone) and wireless communications in the United States."
Under Verizon’s proposed rate hike, premium services such as unlimited local calling and 25 minutes of regional toll calling would be included in the basic plan package. In commenting on Verizon’s proposal, the BPU said, "Verizon’s proposal would not only provide unlimited local calling, but would also include touch-tone service, three custom calling features such as call waiting or call forwarding as well as 25 minutes of local toll calling for $17.50 a month."
Mr. Allibone can be reached at LTC Consulting at 397-2257 or through his Web site – www.ltcconsulting.com.
For further information, the BPU Web site is www.bpu.state.nj.us, and Verizon’s New Jersey site can be accessed through www.bellatlantic.com/.?