Blow Whistle on MCI Billing Practice
-- MCI to Pay States $1.3 Million
alleged MCI misrepresented a "National Access Fee" in long distance
phone bills. MCI to pay Iowa $55,000 for consumer education and litigation.
Attorney General Tom Miller said Tuesday that MCI WORLDCOM Communications
Inc. (MCI) has agreed to change certain practices and pay a total of
$1.32 million to Iowa and 23 other states as part of a settlement reached
by the company and the states. States will each receive $55,000, and
Iowa's share will go for consumer education and litigation.
states challenged MCI's practice, starting last year, of billing its
customers for a new, self-described "National Access Fee"
--and sometimes listing the fee in the "taxes and surcharges"
portion of MCI customers' bills or characterizing the fee as government-imposed.
"We argued this was a misrepresentation," Miller said. "They can impose
their own fees, but they must not misleadingly characterize them as
required by the government. If consumers are going to have any chance
of comparing prices and shopping for the best long distance deals, they
must have truthful information in advertising, on their bills, and when
they call a company."
Miller said an employee of MCI wrongly told a consumer protection investigator
in his office that the "National Access Fee" was imposed by state and
federal lawmakers. Neither the FCC nor any other state or federal agency
has required MCI to collect the charge from consumers.
MCI denied wrongdoing, but it agreed to several measures in an "Assurance
of Voluntary Compliance": MCI will not wrongly represent that fees are
required by the FCC or any other governmental agency; MCI will not use
the term "National Access Fee" or any similar term that could mislead
consumers to think the charge is a tax or government-mandated charge;
and MCI will not place discretionary fees in the tax and surcharge portion
of its bills.