Montana Family Billed Consumers $70 Million In Fraudulent Phone Charges
Better check your cell phone bill. A Montana family and its accountant are facing civil and criminal charges after allegedly billing $70 million in fraudulent charges to Americans’ phone bills. Some of the money was then routed through a religious organization to buy land and pay for one member’s legal bills.
According to a civil complaint filed by the Federal Trade Commission, Steven Sann, his wife Terry, son Nathan and accountant Robert Braach ran nine companies which added unauthorized charges to consumers’ phone bills. When the customers complained or phone companies grew suspicious of one company’s erroneous charges, the Sanns would begin billing from another company.
As of April 2012, 119,810 voice mail accounts were open through the Sanns’ companies, but only 12 customers used their accounts. Between March 2010 and April 2012 less than 1 percent of the people billed for voice mail accounts ever accessed them. According to the FTC, the extremely low usage rates suggest that customers “neither ordered the services nor knew they were being billed for them.”
The nine companies—American eVoice, Emerica Media Corp., FoneRight, Global Voice Mail, HearYou2, Network Assurance, SecuraDat, Techmax Solutions and Voice Mail Professionals—are voice mail and electronic fax services that bill through an intermediary called a bill aggregator. The typical monthly charge is $14.95 and it appears near the end of a bill monthly until a customer notices it and challenges the charge.
The FTC has asked a judge to issue a preliminary injunction that would force the Sanns to end their companies’ operations and freeze their assets. An attorney for the Sanns has asked for a stay in the FTC civil action, stating a criminal investigation is already underway, and allowing the government to pursue both civil and criminal cases is improper as the civil case would grant access to information not allowed under criminal procedural rules.
Although the Sanns returned more than $40 million of the charges after customers challenged the transactions, some of the remaining profits were used to purchase 94 acres in western Montana where Steven Sann now runs a youth camp, according to the FTC. Other portions of the monies were used to pay for Sann’s defense in an unrelated medical marijuana case. In both cases, the money was first deposited in a bank account tied to Bibliologic, a religious organization established by Sann and Branch. Incorporated as a charitable group in 2009, Bibliologic Ltd has no members or physical address, according to the Montana Secretary of State registration records.