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Bogus Fees Comes Back to Bite Rogers, Bell, Telus
Lawsuit Over 'System Access Fee' Moves Forward
by Karl Bode 11:06AM Friday Jun 29 2012 Tipped by tmpchaos See Profile
Just like telcos in the States, Canadian incumbents charge a universe of bogus fees that simply act to jack up the advertised price post sale. It technically should be a considered false advertising and a crime, but it's something regulators generally couldn't care less about. In Canada, one such fee has been the "system access fee," a fee of up to $9 a month -- charged for absolutely no valid reason. After criticism and lawsuits, some carriers phased out the fee -- only to replace it (like Rogers) with equally bogus "government regulatory recovery fee."

Now it appears that the fee has returned to bite Rogers, Telus and Bell on the digital posterior. Canada's Supreme Court this week refused an appeal by Rogers to have a lawsuit over such fees scrapped, meaning a class action lawsuit over the fees begun in 2004 can finally proceed:
quote:
The decision means a class-action suit originally filed in a Saskatchewan court in 2004 can proceed — with 30,000 people already having joined the case, according to lawyer Tony Merchant. “The ultimate goal is, they were overcharging people, charging people wrongly and we want the money back,” said Mr. Merchant of Merchant Law Group and a lead lawyer in the action.
The fact it has taken eight years for anyone to do anything about these fees tells you plenty about just how serious government is about consumers getting ripped off by such junk fees. ISPs have simply changed the name of the junk fee to "regulatory recovery," claiming it directly offsets the nebulous costs inferred by regulation (ignoring the sweeping trend of deregulation). The case lawyers point out such garbage fees are quite profitable: in 2004 alone Canadian incumbent ISPs collected $863-million in system access fees, compared with the $126-million estimated to have actually been paid to governments.

The problem of course that aside from buying a few lawyers a new boat, nothing will really change here and companies will continue to charge bogus below-the-line fees. This is really something any regulator worth its salt would address as false advertising, and bogus fees are a prime example of how many regulators are asleep at the telecommunications wheel.

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travisc

join:2001-11-09
Uxbridge, ON

1 recommendation

Robbing Peter to pay Paul

On the off-chance this lawsuit actually succeeds, the carriers will roll the cost right back onto the backs of current customers. How is this a win for anyone?

vpoko
Premium
join:2003-07-03
Boston, MA

Re: Robbing Peter to pay Paul

It's a win because the fee will be be stated up front. Companies can set their prices how they want to, but they can't advertise one price and then charge another, which is what is going on with these fees.

FFH5
Premium
join:2002-03-03
Tavistock NJ
kudos:5

What will be result if lawsuit successful?

Say this lawsuit succeeds in getting some money back(most of which will go to lawyers) and it also succeeds in getting the providers to eliminate the fees(could happen, though I suspect they would just create new ones and kickoff another 8 yr legal process). So then what? The companies will still get their income somehow - THEY WILL JUST RAISE COST OF THE SERVICE. Now that may be more honest and preferable to the current system. But in the end the customer is not going to pay less.
--
»www.mittromney.com/s/repeal-and-···bamacare
»www.mittromney.com/issues/health-care

vpoko
Premium
join:2003-07-03
Boston, MA

1 recommendation

Re: What will be result if lawsuit successful?

An honestly disclosed price is, to me, the goal. The companies can charge whatever the consumer is willing to pay, it's the advertising of one price and then charging another that's the problem.

FFH5
Premium
join:2002-03-03
Tavistock NJ
kudos:5

Re: What will be result if lawsuit successful?

said by vpoko:

An honestly disclosed price is, to me, the goal. The companies can charge whatever the consumer is willing to pay, it's the advertising of one price and then charging another that's the problem.

I agree.
--
»www.mittromney.com/s/repeal-and-···bamacare
»www.mittromney.com/issues/health-care
nasadude

join:2001-10-05
Rockville, MD
said by vpoko:

... The companies can charge whatever the consumer is willing to pay, ....

No, the companies charge WHATEVER THEY WANT and if a customer wants service he will pay.

Romney2012 is right, these fees will just pop up under a different name or they will just outright raise rates.

Canada is just like the U.S. - captured regulators that don't regulate sh!t and no competition to restrain prices.

pnh102
Reptiles Are Cuddly And Pretty
Premium
join:2002-05-02
Mount Airy, MD
said by FFH5:

The companies will still get their income somehow - THEY WILL JUST RAISE COST OF THE SERVICE. Now that may be more honest and preferable to the current system. But in the end the customer is not going to pay less.

That is a desired outcome. At least if the actual price of the service is known upfront it would make comparison shopping far more easy.

It sickens me that the governments in both the US and Canada care nothing about enforcing the existing false advertising laws on ISPs, cable companies or cellular providers.
--
Romney 2012 - Put an adult in charge.
NefCanuck

join:2007-06-26
Mississauga, ON
Reviews:
·voip.ms

1 recommendation

Re: What will be result if lawsuit successful?

The fact that other industries in Canada have moved to "all in pricing" (airline tickets come to mind as the big one) under the threat of legislation, should have been enough to convince Robellus to give it up.

Most have ironically, on new contracts anyways, which have a higher price monthly but none of this "below the line" nonsense.

However I believe that Rogers still does this via something they call "Government Recovery Regulatory Fee" (GRRF)

"Grrf" is what Rogers et all will be saying once they get smacked down for this deceptive practice.

NefCanuck
asdfdfdfdfdf
Premium
join:2012-05-09
kudos:3
Reviews:
·Verizon Wireless..
Raising the price would be preferable.

I would think, though, if it was that simple to just raise the price (and not suffer consequences in the market) they would have just done that from the outset instead of concocting these silly deceptive practices. Apparently they don't feel it is that easy to raise the price.

J E F F
Whatta Ya Think About Dat?
Premium
join:2004-04-01
Kitchener, ON
kudos:1
Reviews:
·Rogers Portable ..
I've always been able to get rid of the fee's...somewhere they can do it..which is what I do...90% of it anyway. I think it stands at 17 cents....not going to bitch about $2/year.
--
If you can't explain it simply, you don't understand it well enough. - Albert Einstein

ChuckcZar

@teksavvy.com

Hopefully this will lead to more lawsuits

Hopefully this will lead to more lawsuits once the big three are forced to pay back subscribers and former subscribers. A class action lawsuit must be brought about over the issue of modems especially with Bell Canada. Rental rates far above loan shark rates and shipping rates that cost more than the modem itself are grounds for a multi-billion dollar lawsuit. The issue of forcing someone in a free enterprise economy to rent something they should be able to buy should also be brought up.
LondonOntGuy

join:2004-05-12
London, ON

Re: Hopefully this will lead to more lawsuits

lol. This is certainly one big "Fuck you!" to Robbers.

This will be a short lived victory for most though. Expect them to jack up rates on all of their services to recoup the losses from them not being able to shake down customers under the guise of a 'government regulatory fee'.

scrennkraqke

@telus.net

telus = less evil

I've always looked at Telus cellulars "system access fee" as being honest advertising.
Still would of been more preferable to have a higher flat rate without the fee, but my smart phone plan has no access fee(talk + data).
When Telus is stuck trying to be competitive against the corrupt others in Canada who advertise one fee and then add a mysterious conglomeration of multiple $$$$$ to magically increase the incoming dollars, well crap sucks.

Telus is Still better than some others that put bogus terms such as "government fee's" in order to commit fraud. And that's such a fibe against the people.
wilburyan

join:2002-08-01

Re: telus = less evil

My favorite is the fee that Bell charges on it's Express Vu sat. TV...

"Digital Access Fee"

The signal is digital... so we tacked on a couple of extra dollars. :S