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AT&T Charged US Taxpayers $16 Million For Nigerian Fraud Calls
McGruber writes "Bloomberg News is reporting that AT&T got more than $16 million from the U.S. government to run Telecommunications Relay Services, intended to help the hearing- and speech-impaired. However, as many as '95 percent of the calls in AT&T's hearing- impaired program were made by people outside the U.S. attempting to defraud merchants through the use of stolen credit cards, counterfeit checks and money orders.' According to the DoJ, 'AT&T in 2004, after getting complaints from merchants, determined the Internet Protocol addresses of 10 of the top 12 users of the service were abroad, primarily in Lagos, Nigeria.' The DOJ intervened in the whistle-blower lawsuit Lyttle v. AT&T Communications of Pennsylvania, 10-01376, U.S. District Court, Western District of Pennsylvania (Pittsburgh). The DOJ is seeking triple damages from AT&T."
It's treble, not triple.
This is about as surprising as water being wet. AT&T is a company run by hucksters.
.. the only ones getting hurt by the fines will AT&T's customers when they see their bills increase.
I always laugh when a lawyer or judge or politician starts screaming about hitting a business with a financial loss to punish them for fraud or negligence or some other crime or scam. Where do they think that that money is going to come from? Do they think that the CEOs are going to pay it from their own pockets?
That money will come directly from consumers and subscribers. Most who will be completely unaware of this lawsuit. AT&T will up the rates or charge extra for other services or products and that will pay off whatever losses are from this lawsuit.
Basically only the consumers lose. The Nigerian scammers make their money. AT&T makes its money back eventually. The judges and lawyers make their money. And the consumers and taxpayers foot the bill for everything. It's a great system.
"Hearing impaired" is not the preferred phrase. "Hard of hearing" is a better choice. Just a friendly heads up since most hearing people have yet to become aware of this :) I'm hard of hearing.
http://www.nad.org/issues/american-sign-language/community-and-culture-faq
Back then, it was the Sprint relay service. Callers would want to buy a dozen flat panel monitors, and offer a credit card and U.S. shipping address. Card was usually bogus, but sometimes not. We accepted a few orders but when the card would not approve we just dumped them - and callers would call back to order huge quantities of more expensive gear. We actually started refusing these calls from Sprint outright, got threatened with an ADA suit, and then magically they all stopped. I wonder if Sprint figured it out, or if the clan just moved on. Our defense against the ADA complaint was that we did not do business with foreign customers, no matter the shipping address. Part of this scam was to delay the shipments, dispute the charges, get refunded, and the merchandise is gone. Card goes bad, no one to complain to, and merchants usually have no recourse with the issuer or banks. You're just out the money AND the merchandise. We didn't happen to lose a dollar, but they probably managed to nick someone.
Nice work though, AT&T being the disinterested third party for profit.
Now can we start looking into how the Universal Service Find is being hijacked to try and build the rural Internet where no provider seems willing to do so as in some cases legally required? Noooo... but crony capitalism is flourishing, thanks to the few remaining taxpayers.
Feh.
deleting the extra space after periods so i can stay relevant, yeah.
AT&T must have people dedicated to finding new ways to rip off customers. Just this month they retroactively increased my rates for the previous billing period. That period was consumed, billed and paid for. This month my bill goes up (an across the board $5/month increase for DSL), I look it over and see they credited part of the previous billing cycle at the old rate then charged it again at the new rate. I see no way it's legal to go into the past and charge more for services already rendered, billed and paid for.
Probably most people did not pay enough attention to even realize what they did, and for the extra $3 it's not worth going to court. It's just another example of AT&T ripping off customers in a precise way to minimize the chances of getting called on their thievery.
on why nigerian fraud exists,
https://en.wikipedia.org/wiki/Advance-fee_fraud
turns out once the free market is finished sucking a country dry, they really dont care much about the local economy. watching AT&T charge americans for fraud perpetrated as a result of another multinational corporations negligence is like watching Alaska charge rape victims for their kits, or prisoners for their incarceration.
Good people go to bed earlier.
than the crooks that abused the system to run their scams.
at&t fixed the problem with postcard-based registration verification but when revenues when down (due to only legitimate users, which accounted for only 20% of them, getting access to the service) they went back to a free-for-all internet-based registration and then the problem with overseas abuse returned.
of course they should pay.. and pay a hell of a lot more than 3 x 16 million for fraud...
what i would have a problem with though is if the government expects (or requires) relay operators to monitor or log conversation content and act on that content.
The fine article says, that they were required to verify an valid address within the US. They let the user give an address and sent a postcard there with a code. But thus usage went down and there was no fraud. Thus they changed verifying addresses to checking if they are in some database of all valid addresses in the US. After that usage skyrocketed and there were many complains of fraud.
Communication companies are just as big of crooks as the banking industry. The only care they provide for the customer is retaining them by offering miniscule discounts when the wheel squeaks.
$16 million from the U.S. government to run Telecommunications Relay Services, intended to help the hearing- and speech-impaired
Article:
$16 million from the U.S. government to offer a calling service for the deaf that the company knew was being used by Nigerian fraudsters
There's a huge difference between these two statements. The first makes it sound like AT&T thought it was doing something good, but just so happened to be not so good.
The second makes it sound like AT&T knew what it was doing, but did it anyway.
Anyway, I'm usually not one to side with the DOJ, but I hope they kick AT&T's ass to the curb for this.
What do I know, I'm just an idiot, right?
Make CEOs responsible for the actions of their companies. After all, if I defauded the government of 16million dollars you bet your ass I'd be in prison, but somehow AT&T gets only a fine?
A fine that they will not even pay, since the money will actually come from their customers?
The solution is to Jail the CEO.Just ask Mitt Romney, after all, he claims the corporations are people too.
The CEOs should take responsibility, since it's the only way they can justify their outrageous salaries. It sure isn't because they've added value to the company. The S&P500 has been flat for a decade, but CEO compensation has gone up 400%.
Disclaimer: I am the 99%
If telephones are outlawed, then only outlaws will have telephones.
We get a ton of these calls at our restaurant. It costs us time taken away from actual customers on the fear that we might actually get a real relay call someday. However, I can pretty much guarantee that it will never happen. The caller always asks for 50+ of the exact same item (never on our menu but generic enough to be on most restaurants menu). I wish we could class action sue AT&T for our business costs dealing with these fraudulent calls. FYI, we have found that the best way to shorten up the call is to ask how the weather is in Nigeria. Pretty much guarantees a disconnect.
Why is it the federal government's job to fund this service at all?
:wq
"Some voices got treble, some voices got bass
We've got the kind of voices that are in your face!"
-- Beastie Boys
See? Not out of use at all... Oh, wait, we're talking about treble/triple though aren't we?
Dream as if you'll live forever.
Live as if you'll die tomorrow.
~Anonymous~
The new politically correct term for all the people who keep telling us to use politically correct terms is:
Nigger.
Yeah I know, strange and perhaps bothersome to some, but there's nothing we can do. Now back to our Asian-American reporter Trisha Takanawa.
Trisha: Thanks Nigger. Today in Quahog...
I would expect AT&T to settle this quickly, possibly for full price. According to Yahoo Finance, AT&T is sitting on $3.18B in cash. Paying $15M to make this bad PR go away seems like a bargain.
It's amazing to me that this corporation keeps breaking the law, yet somehow manages to keep getting away with it. How many people will drop AT&T over this? or this?, or this? Nobody.
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By now I don't remember what year it happened, but 2002 seems about right. I got a call from the internet deaf relay on a Sunday night on my work cellphone, with somebody who had a business proposition for me. I was in a noisy restaurant so I couldn't really hear the operator, and asked them to call back in the daytime; he called again the next evening. I don't think the guy really understood the concept of time zones, and he certainly didn't know that Memorial Day was a holiday and therefore a really unlikely time to sell my company whatever scam he was pushing.
Bill Stewart
New Fast-Compression-only CPR http://preview.tinyurl.com/dy575ks
I figure it to be somewhere around 24 cents.
That is triply uninteresting.
Just block the whole country. All I see is issues from Nigeria, Brazil and Russia that account for 90 some percent of the attacks and spam.
My friend's son gave their AT&T phone number to a bunch of different websites because he thought he'd get a free game if he did so. Soon afterwards, my friend found out that their phone bill was over $300 (it's usually about $40) that month. Turns out AT&T let random companies stick charges onto their bill so that these places would get paid (for completely ridiculous things such as hurricane insurance, and hurricanes don't happen here). Basically, if you know someone's phone number, you can really cause them some trouble.
Just like power companies who ask for rate increases to cover infrastructure improvements/upgrades these are costs that should be paid out of existing revenue and shareholder dividends, not by pushing for more income.
Doing this isn't simple. Perhaps a combination of executive pay/asset seizure, rate freezes/reductions, and a moratorium on low-level staff reductions would accomplish it. It would never fly because then 'the government can't tell us how to run our business' but if you're hit with a government fine then maybe they should be able to do it. The bookkeeping and oversight would be huge but that's added onto the fine itself - the company has to pay for it. They would certainly feel the pinch when they no longer have sole control over their books.
I know, ain't going to happen any more than class action attorneys getting the same type of compensation as the plaintiffs (vouchers and coupons anyone?) but a person can dream.
I guess the government only gets to be overly intrusive when it's to private citizens.
If you want to get a message accross to a child who's naughty, you take away their toys
if people start to DROP with Nigeria, their Gov might get serious about cracking down
personally we already on all our sites and offices we block entire continents, China,Eastern Europe, Africa, S-America
it cut down our intrusion attempts by 99% (the other 1% are compromised Linux boxes in USA and Amazon EC2)
How is it AT&T's fault people used their service fraudulently? That is like blaming the department of transpiration due to people running drugs in cars.
---- Booth was a patriot ----
$16 million for hearing and speech impaired telephone service? Am I missing something here?
Never say never. Ah!! I did it again!
[url="http://www.17city.net"][/url]
At some point, cutting Nigeria from the civilized internet world could start making sense.