V. STAFF DISCOVERED AMERICATEL OVERCHARGED CUSTOMERS $2 MILLION IN RATES AND FEES

On January 29, 2009, Staff issued a data request to ILD to obtain further information regarding Americatel's customer credits.³⁹ On February 5, 2009, ILD provided the data on customer credits/refunds it made on behalf of Americatel from 2005 through 2008.⁴⁰ (See table below.)

Table 5: Americatel Customer Credits/Refunds (Intrastate)

(2005-2008)

Source: ILD (Americatel's Billing Aggregator) Data Response Dated February 5, 2009

Staff noted a substantially higher amount of total credits to customers of $3.5 million in 2008 from ILD's response compared to the $1.5 million Bravo-related credits reported by Americatel. This led Staff to inquire further on what the difference is attributable to. After numerous and persistent questioning, Staff obtained confirmation from Americatel that the actual total customer credit is indeed $3.5 million as reported by ILD, representing 360,504 separate credits.⁴¹

In its response dated November 12, 2009,⁴² Americatel confirmed that the Bravo-related incident resulted in $1.5 million credits to 61,097 California customers in 2008. Additionally, Americatel explained there were another $2 million credits issued to approximately 300,000 California customers due to two billing errors. Americatel admitted to overcharging customers by applying the wrong USF rate and applying higher per minute plan rates. In its reply, Americatel stated:

"The first, and most significant, error occurred in the August 2008 invoices, when the USF rate appeared at 100% of the July 2008 revenue instead of 11.4%. Effectively doubling the customer's regular invoice, this error was immediately brought to the company's attention, resulting in approximately $1.8 million in credits. Regarding the second error, in October of 2008, select call charges for Americatel's dial around service plan, Uniendo America, were calculated based on erroneous per minute rates, resulting in an overcharge. The error was discovered shortly after invoicing and resulted in about $204,000 in credits to the impacted customers."⁴³

³⁹ Attachment G-2. Initially, staff sent December 5, 2008 Data Request, attached as to this report as Attachment G-1.

⁴⁰ Attachment G-2. Initially, ILD submitted January 9, 2009 Data Response, attached to this report as Attachment G-1.

⁴¹ September 18, 2009 Americatel Data Response (Attachment H)

⁴² Attachment I

⁴³ USF refers to Universal Service Fund. All telecommunications service providers and certain other providers of telecommunications must contribute to the federal based USF based on a percentage of their interstate and international end-user telecommunications revenues. Some consumers may notice a "Universal Service" line item on their telephone bills. This line item appears when a company chooses to recover its USF contributions directly from its customers by billing them this charge. The FCC does not require this charge to be passed on to customers. Each company makes a business decision about whether and how to assess charges to recover its Universal Service costs. These charges usually appear as a percentage of the consumer's phone bill. Companies that choose to collect Universal Service fees from their customers cannot collect an amount that exceeds their contribution to the USF. (Source: FCC website URL)