FTC Asks Court to Shut Down $70 Million Cramming Operation

As part of a continuing crackdown on fraud and deception, the Federal Trade Commission filed a complaint against a family accused of a $70 million scam involving bogus phone charges. American eVoice, Ltd., eight other companies, Steven Sann, his wife, son and accountant are named in the complaint for "cramming" unauthorized charges onto consumers’ phone bills. The process known as phone "cramming” involves companies that charge people for services they didn't authorize, never ordered or may not even known they had. The FTC says the charges ranged from $9.95 to $24.95 a month, totaling about $70 million. According to the complaint, the nine companies are voicemail and electronic fax services that would transmit the charges to a third party known as “billing aggregators” who were told that the consumers had authorized the charges by filling out forms on the internet. The charges were then passed on to customers of phone companies such as AT&T, Frontier and Verizon. The FTC also alleged that the defendants channeled their illegal proceeds through a purported non-profit corporation that has no right to the funds and must disgorge them to the FTC. Some of the money went to buy 94 acres in western Montana where Steven Sann runs a youth camp, the FTC alleges. Some went to pay for Sann's defense in an unrelated medical marijuana case. If you would like to read more about this case and others, visit our Case Studies Library.