July 16, 2003
A federal judge has issued an order barring Alyon Technologies and Telcollect from seeking payment from thousands of consumers the defendants fraudulently billed for Internet videotext services.
U.S. District Court Judge R. W. Story's order also requires Alyon to pay restitution to consumers who have already filed written complaints with Alyon and the Federal Trade Commission protesting the bills, and those who do so in the next 90 days.
To receive restitution, consumers must 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. Alyon will have 30 days to investigate the disputed charges.
Consumers can file complaints with the FTC online at www.ftc.gov, or by sending a written complaint to:
The Federal Trade Commission
Consumer Response Center, Alyon Matter
600 Pennsylvania Avenue, NW, H-130
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.
