Goldhawk Fights Back: Competition Bureau attacks fine print on long distance phone cards

This is a weekly column by Dale Goldhawk, Canada’s best-known consumer advocate. A journalist, author and broadcaster, Dale hosts Goldhawk Fights Back For You, on AM 740 or at AM740 ZoomerRadio, Monday through Friday from 11 am to 1 pm, in the eastern time zone. Visit his website at www.goldhawk.com.

The Competition Bureau, a federal law enforcement agency always on the lookout for misleading advertising, has fined a phone card company $300,000.

The Bureau says that Phonetime Inc. used confusing fine print on advertising posters that misrepresented the exact amount of their per-minute charge.

The bottom line: Customers actually got fewer long-distance minutes that advertised and paid hidden fees every time they made a call.

Phonetime Inc. is also being ordered to offer refunds to customers who bought Bravo and Bravo Atlantic pre-paid long-distance phone cards. Based on the level of misrepresentation, the Bureau is ordering a 78 per cent refund. That means you would get $7.80 back from a $10 phone card. But it’s a bit of an empty promise because you need a proof of purchase for the card to get the refund. The chances you hung onto that receipt are slim, indeed.

The Competition Bureau began its investigation of Phonetime Inc. back in 2006.

It is the second time a long-distance phone card company has been fined by the Competition Bureau. In 2004, Goldline Telemanagement Inc. was ordered to pay $750,000.

So the feds are sending a strong message to long-distance phone card companies that never let the facts get in the way of a good advertising pitch.

“The Bureau has clearly communicated its concerns to the phone card industry and any company found to be misleading consumers could become the target of an investigation,” said Andrea Rosen, Deputy Commissioner of Competition in the Fair Business Practices Branch.

Phonetime Inc. has also been ordered to perform a bit of a public Mea Culpa. It will publish what the Bureau is calling “corrective notices” in major and community newspapers.

Photo ©iStockphoto.com/ Ed Hidden

READ OTHER COLUMNS BY DALE GOLDHAWK

Goldhawk Fights Back: Protecting privacy in a high tech world

Goldhawk Fights Back: Government not tough enough on fraud

Goldhawk Fights Back: Keeping bankers at bay

Gemini award nominee, journalist and broadcaster, Dale Goldhawk has earned Canada’s trust by his four decades of work exposing fraud and greed in the marketplace. To read more of his articles, go to www.Goldhawk.com (now part of the ZoomerMedia family of websites).

Don’t miss Goldhawk Fights Back , on the New AM740 Monday to Friday from 10 a.m. until 1 p.m.