Consider the following facts: Latinos may be losing up to $1 million per day because of fraudulent prepaid calling cards. The average calling card only delivers 60% of the minutes advertised. The cost-per-minute rates for prepaid phone cards can be up to 87% higher than expected. In response the National Hispanic Media Coalition has issued a consumer alert.
In response to these incredible facts, the US government is starting to take a serious look at this industry. Last week, the Federal Communications Commission (FCC) announced that it had found four prepaid calling card companies liable for $20 million in fines for “using deceptive marketing practices to sell prepaid calling cards, scamming consumers out of millions of dollars, mostly from low-income and minority communities.”
Through its investigation, the FCC found that many of the calling cards offered could only be used for a fraction of the minutes advertised, mostly due to excessive, hidden fees. Many of these companies targeted Spanish-speaking immigrants by promising low cost calling options to a number of countries in Central and South America and the Caribbean.