Avoiding Deceptive Prepaid Phone Cards
BBB Offers Tips to Make the Most of Your Minutes
Austin, TX - Prepaid calling cards may seem like a great value, claiming to provide hundreds of minutes for a few dollars. However, some phone cards come with hidden fees and service charges which deliver far fewer minutes than advertised. Better Business Bureau offers advice on how to get the most out of a prepaid phone card and avoid getting ripped off.
Prepaid phone cards are widely available at stores, newsstands, and online. Some cards are meant for one-time use and can be thrown away when the minutes are used up. Others can be recharged by using a credit card. According to the Federal Trade Commission (FTC), prepaid phone cards make up a $4 billion per year industry. However, a 2007 survey by the Hispanic Institute found that, on average, prepaid phone cards delivered only 60 percent of the minutes promised and that fraudulent phone cards were swindling people out of about $1 million every day.
“Phone cards continue to be a popular way to stay in touch with friends and family out of state and overseas,” said Carrie A. Hurt, President and CEO of BBB serving Central, Coastal and Southwest Texas. “Consumers need to read the fine print on phone cards to be aware of cleverly hidden fees or conditions.”
As part of a national crackdown on the prepaid phone card industry, the FTC has already investigated several companies for deceiving consumers. Allegations against companies include misrepresentation about the amount of minutes available on cards and failing to disclose maintenance fees.
BBB offers the following advice for getting the most for your money when buying a prepaid phone card:
- Research the disclosures about expiration dates, surcharges, maintenance fees and any conditions that might vary based on where you are calling to and from.
- Find out the rates for both domestic and international calls. Be wary if the rates aren’t posted on the card or with advertising and displays.
- Compare rates, but don’t be immediately sold by a low rate. Very low rates may be enticing, but they should also serve as a red flag that the card may not deliver the number of promised minutes.
- The card should come in sealed packaging that has not been tampered with. Each card should also have a personal identification number (PIN) that is not visible. Cards and packaging that have been tampered with run the risk of having the PIN numbers stolen and used before a buyer can use the card.
For more advice from your BBB to help save money and to check the reliability of a business, visit
www.bbb.org.
About BBB:
BBB's mission is to be the leader in advancing marketplace trust. BBB accomplishes this mission by creating a community of trustworthy businesses, setting standards for marketplace trust, encouraging and supporting best practices, celebrating marketplace role models and denouncing substandard marketplace behavior.
Businesses that earn BBB Accreditation contractually agree and adhere to the organization's high standards of ethical business behavior. BBB is the preeminent resource to turn to for objective, unbiased information on businesses and charities.
Contact BBB serving Central, Coastal and Southwest Texas at (512) 445-4748.
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