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Madigan sues two Prepaid Calling Card companies

Posted by Admin On November - 4 - 2011

Companies Targeted Immigrant Communities, Sold Cards with Up to 50% Fewer Minutes than Advertised and Hidden Fees

 

Chicago, IL — Illinois Attorney General Lisa Madigan filed two lawsuits against Chicago- and California-based companies for marketing prepaid calling cards to consumers, particularly to immigrant communities, that offer up to 50 percent fewer minutes than advertised and are riddled with hidden usage fees.

“Consumers need to read the fine print on prepaid calling cards,” Attorney General Madigan said. “Their advertising is extremely misleading about the actual number of minutes offered, and they’re loaded with hidden fees that make their value questionable at best.”

Madigan filed suit in Cook County Circuit Court against Nobel Tel LLC and NTI Inc., a Chicago company. Madigan said the companies targeted marketing at immigrant consumers seeking to make international calls.

The law against NTI, which is located at 4718 N. Kedzie Ave., alleges that the company’s prepaid cards provided an average of 50 percent fewer actual minutes of talk time than the total time advertised. The company sells cards at neighborhood convenience and telecommunication stores in the Chicago area.

Nobel Tel, based in Carlsbad, Calif., sells, distributes and markets to Illinois retailers prepaid cards that are riddled with hidden fees – from hang-up fees to daily usage charges. Madigan’s investigation revealed that some cards misrepresented the actual amount of call time available. The cards’ packaging referred to “units” of time as opposed to actual minutes, where one “unit” represented only a portion of a minute of international talk time.

Madigan is asking the court to prohibit the companies from selling, manufacturing, distributing or marketing prepaid calling cards in Illinois, obtain restitution for affected consumers and impose civil penalties on the defendants for the allegations laid out in each of the complaints.

Assistant Attorneys General Andrew Dougherty and Sarah Poulimas are handling the cases for Madigan’s Consumer Fraud Bureau.

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