The FTC has today released an update of their July 16, 2003 Press Release. This update extends time allowed to file complaints and also allows the use of the online complaint form rather than requiring a letter.
Here is a cut and paste of today's release:
CORRECTED October 29, 2003
For Release: July 16, 2003
Alyon Prohibited from Billing or Collecting Payment from Consumers Without Their Authorization
A federal district court order bars defendants from billing or collecting payment from consumers for Internet videotext services the consumers do not agree to purchase or authorize someone else to purchase. Under an Order issued by U.S. District Court Judge R. W. Story in the Northern District of Georgia on July 10, 2003, and clarified in an order issued on October 17, 2003, defendants Alyon Technologies, Inc., Telcollect, Inc., and Stephane Touboul are prohibited from billing, collecting, or attempting to collect payment from consumers without first fully disclosing the material terms of the sale to the consumer, or someone authorized to act to incur the charges, and also verifying that the person receiving the services was authorized to incur the charges.
The July 10 order required Alyon to pay restitution to consumers who filed written complaints with Alyon and the Federal Trade Commission protesting the bills, and those who did so within the next 90 days. To receive restitution, consumers had to show that they did not subscribe to the telephone line when the charges were incurred; that a minor accessed the services without the consumer's authorization; or that the site was otherwise accessed without the consumer's authorization. Under the terms of the order, Alyon has 30 days to investigate the disputed charges. In the event that Alyon disputes a consumer's claim of unathorized access, a third party arbiter will decide whether the consumer is entitled to restitution.
The court's October 17th order extended the time in which consumers can file written complaints with Alyon until January 14, 2004, and dropped the requirement that consumers must also file written complaints with the FTC as well. Consumers can file complaints with the FTC using the complaint form on our website at http://www.ftc.gov, or by sending a written complaint to The Federal Trade Commission, Consumer Response Center, Alyon Matter, 600 Pennsylvania Avenue, NW, H- 30, Washington, D.C. 20580.
In May 2003, the FTC and 13 state Attorneys General charged that Alyon was illegally billing and collecting for videotext services purportedly accessed on the Internet. According to the FTC, the defendants use a modem dialing program to disconnect consumers from their own Internet service providers and reconnect them to the Alyon's network without the consumers' authorization or approval.
Using the dialing program, the defendants allegedly capture the telephone number used by the modem and match it against several databases of line subscriber information, databases which frequently contain errors. The line subscribers identified as responsible for the captured telephone number later receive bills charging them $4.99 a minute for each minute the defendants claim videotext services were purchased, regardless of whether the line subscribers authorized the purchase.
The FTC alleges that many consumers never visited the defendants' sites at all and were charged due to billing service errors of which the defendants were aware. Furthermore, according to the FTC, the defendants' dialing program downloads onto consumers' computers without their authorization. The FTC, which received more than 1,200 consumer complaints about Alyon in its Consumer Sentinel Database, coordinated the investigation of this case with the invaluable assistance of th offices of numerous state Attorneys General, including the New Jersey Attorney General, the Illinois Attorney General, the Idaho Attorney General, and the Wisconsin Department of Agriculture, Trade and Consumer Protection.
The Commission vote to authorize staff to file the complaint was 5-0. The complaint was filed in the U.S. District Court for the Northern District of Georgia, Atlanta Division.
NOTE: The Commission files a complaint when it has reason to believe that the law has been or is being violated, and it appears to the Commission that a proceeding is in the public interest. The complaint is not a finding or ruling that the defendant has actually violated the law. The case will be decided by the court.
Copies of the complaint and the judge's order are available from the FTC's Web site at http://www.ftc.gov and also from the FTC's Consumer Response Center, Room 130, 600 Pennsylvania Avenue, N.W., Washington, D.C. 20580. The FTC works for the consumer to prevent (censored) deceptive, and unfair business practices in the marketplace and to provide information to help consumers spot, stop, and avoid them. To file a complaint use the complaint form at http://www.ftc.gov. The FTC enters Internet, telemarketing, identity theft, and other (censored)-related complaints into Consumer Sentinel, a secure, online database available to hundreds of civil and criminal law enforcement agencies in the U.S. and abroad.
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