Slamming Statement


 I would like to welcome everyone to this hearing on a very important consumer protection issue. This is a letter that was recently carbon copied to me by a constituent:<P> <I>"Dear [phone company x]:<P> In April I received a telephone call from your marketing service company. They did not identify themselves as a marketing service firm...They asked me if I wanted [phone company y] to carry my long distance telephone calls. I told them that [phone company y] was already providing that service for me. They then asked me if I wanted [phone company y] to continue that service. I replied yes and terminated the call.<P> Yesterday I received an invoice from you and determined that the April conversation with your marketing service was designed to mislead me and cause me to authorize a switch in my long distance service provider while still using [phone company x]...<P> I canceled your service on receipt of your invoice... This is the second time my long distance provider has been changed surreptitiously. This proselytism has to cost money which in the end the telephone subscriber will pay.<P> Sincerely,<BR> [Iowa consumer]"<P></I> This is the problem we are here to examine today. It is called slamming. Slamming is the unauthorized switching of a consumer's phone carrier without his or her authorization. As you can see, it costs consumers time and money and causes great frustration.<P> According to the Federal Communications Commission (FCC), 16,000 consumers filed slamming complaints last year. In the first nine months of this year, the FCC has already received 15,000 slamming complaints. It is the number one telephone-related complaint they hear. Even with these huge statistics, a recently released Harris poll said that 41 percent of people who are slammed don't complain at all. In recent testimony before another Senate subcommittee, FCC Commissioner Susan Ness said, "[because most slammed consumers grin and bear it, we don't know how many of the 50 million carrier selection changes each year result from slammings, If just one percent were changes due to slamming -- a very conservative estimate -- that would total over 500,000 slamming incidents each year."<P> Since noticing this hearing my office has received calls from various telephone companies wondering why I am having this hearing and, specifically, what is my angle and which company I am going after. These companies' concerns explain part of the problem. It seems the companies are so busy fighting among themselves that they forget the consumer. Let me be clear. I am holding this hearing for one very simple reason: my constituents are being slammed. My constituents, the phone companies' customers, are being hurt. That's it. That's why we are all here today. I would also like to thank Senator Durbin of Illinois for helping to bring this issue to my attention.<P> Slamming is taking the choice for telephone service from the consumer and giving it to the phone companies. We need to restore the right of consumers to pick their own service. <P> To this end, the FCC is proposing to toughen its regulations. Two bills have been introduced in the Senate that address this problem, one by Senator Durbin and one by Senator Ben Nighthorse Campbell. I thank my colleague sitting next to me for his hard work and diligence on this issue. And at this time I'd like to insert a statement from Senator Nighthorse Campbell in the hearing record. In addition, Governor Pataki from New York has sent information on the two laws just passed in New York to remedy this problem.<P> I would like to take a moment to extend a special welcome to Bill Smith from the Iowa Utility Board. I appreciate his assistance in informing the Senate what is happening in Iowa. We are going to hear from a range of witnesses today. We will hear from everyone from telecommunications companies to consumer advocates. Hopefully, we will help find a solution to this growing problem.<P> I hope we don't spend our time today hearing from companies that slamming is someone else's fault. Every minute that we spend pointing a finger at the other guy, the other company or the consumer, is time not spent solving the problem. Rather, tell me that you will help the consumer.<P> Slamming is not the consumer's fault and the consumer's valuable time and resources should not be spent correcting slamming. Remember, it is the telecommunications companies and the FCC who get paid to solve this problem, not the consumer. <P> As far as blaming the consumer, if it is consumer confusion that results in slamming, then it is up to the companies to be clearer. Telecommunications is a very complex and technical industry, and you have a responsibility for educating us, the public, about it. If it is your telemarketers that are slamming people, then take away their incentives to slam or inject a better system of quality control. You must take responsibility for your telemarketers and your business operations. We must all work to solve this problem. We must all do this by keeping our eye on the most important part of the equation, the consumer.