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Talk of the bay

Radio Shack settles in phone service 'slamming' case

By LOUIS HAU
Published April 25, 2005

It sounds like an unlikely sales pitch: "Buy anything in our store and for no extra charge, we'll change your long-distance carrier to Sprint without your knowledge! Act now!"

Yet that's what state Attorney General Charlie Crist said was happening at numerous electronics stores in Florida when he reached a $2.4-million settlement in May with Sprint Corp. Crist said customers were being tricked into signing what looked like a sales receipt but was a letter of authorization switching their long-distance service to Sprint. Such practices are known in the industry as "slamming."

Last month, Crist quietly reached a settlement with Radio Shack Corp. for the alleged involvement of some of its stores. Under the deal, Radio Shack, which is a vendor of Sprint phone services, admitted no wrongdoing and agreed for two years to honor requests from the attorney general for documents and interviews with Radio Shack officers and employees without the need for subpoenas.

The settlement requires Radio Shack to conduct internal quarterly audits of its Florida stores that sign up the most customers to Sprint long-distance service. In addition, the company agreed to make $200,000 in donations to Florida International University and the University Area Community Development Corp. The company agreed to pay $50,000 to a fund managed by the attorney general's office for the reimbursement of slamming victims who have not been reimbursed.

[Last modified April 22, 2005, 18:56:02]