Righting wrongs, under cover of darkness

TROXLER E-mail: Click here Archive

By HOWARD TROXLER

© St. Petersburg Times, published April 25, 2001

To quote The Fifth Dimension and a bunch of other folks, let the sun shine in!

Until now, Verizon, that phone company formerly known has GTE, has blocked the release of many documents in a state investigation of "slamming." Slamming is the practice of switching customers' long-distance company without their permission.

Verizon kept these documents under wraps with a state law that protects legitimate "trade secrets." Classic examples of trade secrets would be the recipe to Kentucky Fried Chicken, or the formula for Diet Coke.

Exactly how allegations of lying and forgery by a Verizon subcontractor are "trade secrets" is a good question. Perhaps Verizon was worried that its rivals would learn how to cheat better.

Bob Elek, a Verizon spokesman, told me the company simply made an initial routine request to protect any sensitive material that might arise. The existence of the case itself was quite public, he pointed out: "I wouldn't say we were hiding from anything. It's not like we were saying it didn't happen."

But the devil is in the details. Now that the state Public Service Commission has made the documents public, the details are wonderful reading.

The story begins in January 1998. GTE began using a Maryland-based company, Snyder Communications Inc., to sell long-distance service to "ethnic" communities. The records do not say which ethnic groups were targeted, although one document makes reference to the holiday of Cinco de Mayo.

Complaints began at once. According to testimony, some customer signatures were forged. Some names signed to the required letter of authorization belonged to dead people. Apparently enough dead people were signed up to justify a "deceased" category on GTE's form for handing slamming complaints. (My telephone message asking Snyder for comment was not returned.)

There is nothing in the record to suggest that GTE authorized or approved of these practices. Just the opposite. GTE officers met with Snyder repeatedly and imposed new policy after new policy. By November 1998, GTE told Snyder to stop selling long distance. The next month, GTE officials notified the state -- they turned themselves in, albeit after the fact.

The state investigation confirmed 209 cases of slamming. There were doubtless many more, because most victims do not file complaints. By last July, the state and the company reached a deal. The company would not admit wrongdoing but would make a "contribution" of $209,000 to the state -- $1,000 for each confirmed violation.

Public Counsel Jack Shreve, who represents customers, objected to the deal as too lenient. After all, in another slamming case, the state fined a more blatant offender $1-million.

Shreve's star witness against Verizon is R. Earl Poucher, an analyst who calls the confirmed slamming cases "the tip of the iceberg." GTE knew early on that the problem existed, he testified.

Poucher recommends the maximum fine of $25,000 a case. He even recommends the state consider revoking Verizon's power to offer long distance.

The testimony of current and former GTE/Verizon officers is that the company responded quickly, tried to fix the problem, and finally terminated the subcontractor and notified the state.

"If anything, the company believes the monetary portion of the settlement offer was too generous, given the mitigating factors in this case," one Verizon vice president testified.

Maybe, maybe not. You could criticize the company for not taking more drastic action sooner. But as so often happens, the cover-up is even more offensive. The company used a state law meant to protect legitimate trade secrets to keep these details hidden from you. Now you know anyway.

- You can reach Howard Troxler at (727) 893-8505 or at troxler@sptimes.com.

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