Saturday, August 23, 2008


The final installment of our 3-part story about inflated BT bills, premium-rate profits and customer nightmares

But hold on a minute. How can I accuse BT of making a mint? Didn’t I mention what their customer reps said about their share of premium-rate profit being given to charity? According to their official letter, "BT would like you to know that it does not wish to profit from this type of problem. BT takes only £1.85 per £100 worth of calls, the remaining revenue going to the service provider, and BT has pledged to donate its share of revenue to Childline".

Their peculiar way of looking at things is tantamount to someone helping burglars break into your home to grab hold of a couple hundred quid they find in your draw, then replying to your angry objections that they only wish to give their share to charity. Their case would sound like: "I had a hunch he was dodgy, but I have no hard evidence he broke in. He just came back with some cash. All I did was drive him down to your place while you weren’t in… And I know the geezer may be a bit of a crook but I have no proof the money he keeps coming back with is nicked so I'm just gonna keep netting my cut and then pass it on to charity".

Financial-crime and money laundering expert Jeffrey Robinson nailed it right on the head with a piece on the Sunday Times. "If Verwaayen and BT took legal advice that charitable donations somehow exonerate them, then they are living in a fools' paradise", he wrote, adding that "If BT passes money on to bad guys, when there are reasonable grounds to suspect that the money is the proceeds of crime, it is potentially guilty of a crime". Notably, "BT could be open to the charge of being involved in money-laundering if at any stage it knows or suspects customers are victims of a premium-rate scam". And BT knows, because their letter brings up "this kind of problem" and "diallers acting outside of the guidelines". Not only that, but "BT had been receiving complaints about dialler fraud for at least two years", continued Robinson, "If it had only received a few dozen, that may not have indicated something was a miss. Perhaps a few hundred might have tipped the balance. But what a conclusion, other than some kind of criminal activity, can a reasonable person make after more than 80,000 complaints?"

That aside, the very claim that BT are not profiting from Premium-rate fraudsters is open to doubt to say the least. Robinson explained that his fraudsters were premium-rate providers who leased their number from a UK network operator, Redstone Communications Ltd.
"With tens of thousands of people around the country suffering the same fate, BT was possibly handling millions of pounds worth of money that could be dirty. […] I looked at Redstone Communications. In 2002 the company nearly went broke and was forced to sell its national telecom network - to BT! Today, Redstone resells products on behalf of BT, which means BT has an interest in Redstone, making BT's claim that it only has a 1.85% stake in premium-rate calls rather less than the whole story". In fact, whereas it's true that technically BT only pockets 1.85% (still hundreds of thousands of pounds, possibly more) of your rogue bill, the network operator is entitled to around 30% of the same potentially dirty sum. But if the same network operator is a subsidiary of BT then I'll leave you to draw your own conclusion.

The press also reported that the network providers were leasing out their lines to people who would call themselves Mr Michael Jackson or Mickey Mouse, hardly a ringing endorsement of a premium rate provider's integrity. Given that BT & co. are supposed to provide a public service, they also have a duty of care to their customers, which they were eluding by not checking the credentials of many a '0909' numbers.

In January 2005, the BBC ran a story about a 78-year-old pensioner whose phone was cut off when he failed to settle his £800 BT bill "which he blamed on a rogue internet dialler on his computer". Anxious to safeguard its public image, BT issued a press release announcing that they'd write off Mr Church's debt. However, they maintained it'd be a one-off as "the ex-gratia payment in no way implied BT was at fault or liable for the charges".

Less lucky were Dennis and Brenda Stevens, an elderly couple from Norfolk scammed out of nearly £4,000 and struggling "to make ends meet". On BBC1 Look East, BT claimed it wasn’t fraud and cut them off. And so 2005 went on with similarly depressing stories piling up.
In the end I turned out to be one of the lucky ones. Successive phone calls to BT and yet another letter gave me a chance to inform them that in no way was I to pay hundreds of pounds for calls I didn’t request. I also told them I was ready to go the whole hog for that, court included. I don’t know whether it was sheer stupidity, Mr Jones-like delusion of grandeur, or simply a pathetic moment of inspiration (perhaps all three). But during one of those phone calls I advised them to make a note on my file that - as a journalist for The Independent- I'd make sure my case was to receive ample publicity. Complete make-believe bollocks of course. I was a disgruntled Museum visitor assistant and a job at The Independent couldn’t have been a more frustrating (and remote) dream to me.

Nevertheless, many websites reported on BT's susceptibility to their public image not to mention the claim that BT would cave in light of legal actions being threatened. All I can do is tell you what happened to me. One Saturday morning I answered the phone to a lady by the name of Juliet who introduced herself as a senior manager from BT's Customer Service team. It was a far cry from any previous correspondence I'd had with BT up until that moment. She apologised profusely and gave me her word that her call was the last I was to hear from them about the matter. She informed me she was taking on the responsibility to write off my £605.77 bill on the grounds that their Call Level Charge facility had let me down.

I was still grudging at BT and the heartaches it'd wrought. However I appreciated what she told me. She didn’t quite go as far as saying that BT were as guilty as the 0909 fraudsters, but she admitted they'd been nowhere near enough performing their public duty. I was relieved, yet fully aware that without that Call Level Charge issue to cling on to I would have ended up like the poor OAPs in Norfolk. Not to mention my PC -which isn’t pocket money- was now ready for the rubbish tip, having amassed more viruses and Trojan horses than a hospital's quarantine ward. That, of course, courtesy of the fraudsters.

Nationwide, the epidemic had just got out of proportion for anyone to still deem it profitable. In May 2005, BT proudly announced its "two initiatives to help beat rogue dialler scams", making free software downloadable "to stop computers using numbers not on a user's 'pre-approved' list". Paired to their anti-hijack software, BT introduced their new "early warning system which will alert BT customers if there is unusual activity on their phone bills". Few weeks into the announcement, "the company said more than 2,000 customers a day [were] downloading [the free software] it [was] offering. But thousands of customers [would] still have to pay huge phone bills, racked up after their computers were infected" Many believe that BT's belated initiatives, coupled with Icstis finally showing some grit, were behind the problem eventually fading out. Then again, in spite of extensive research, to this date it's difficult to establish the full cost of that national scam on UK customers, not to mention the amount of anguish and distress. For sure, the dial-up scandal left a permanent scar on the public's perception of what had once been a reliable British institution.

Barely two years after the dial-up scandal, BT were again in the eye of the storm, this time with their "stealth charges" - the rise in line-rental, late payment penalty increases and additional charges on non-direct debit payment.

At the end of 2006, BT announced a daily profit of £5.05 million after tax.


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Anonymous said...

I have a straight-from-hell tale about British Telecom to tell.Last year I received the wrong bill through the post. It was wrong in the sense that what should have been £50 at the most turned out, according to them, £270. I thought it was simply a blunder and easily rectified.

Wrong. Eight months followed including our request to have the bill checked and amended, red letters, line cut off, court letters and a customer service that overall was seriously crap and unhelpful. 8 months to have the bill written off.

Sean O'Connor

Poor BT said...

I and my flatmates applied for a landline and have been waiting for nearly 2 months. 2 months ago, we applied for the landline, and after a couple of days, despite promising to call back, they told us that our order had been cancelled due to some error. Prior to this, we had a conversation with someone from BT, and when we asked to see a supervisor, she hung up.

Now, we realised that we could simply change account details (we thought we had to get a new line). So we did that about a week ago. Unfortunately, just yesterday, we know that didn't work. Why? Because it appears BT has terminated our landline.