IDEAS & OPINIONS The Union Monday, May 26, 2003

The Union Newspaper     IDEAS & OPINIONS     Monday 26 May, 2003


‘There’s cash in them thar telephone bills’


Years ago in the Gold Country the cry went out, “There's Gold In Them Thar Hills!” something the mine owners had tried to keep secret. Now we can reveal another secret about hidden cash for residents and businesses in the Gold Country. The new cry is “There’s Cash In Them Thar Telephone Bills”.


You may be surprised to learn that 70% of telephone bills contain errors, and that 80% of these errors favor the telephone company. Back in 1849, gold fever was born, and people imagined finding “piles of gold” lying around. Well, in 2003 there is a good chance you will find “piles of cash” owed to you or your business by the telephone companies.  It’s true! Telephone bill audits undertaken for local businesses have resulted in some staggering results.


A local company obtained a $30,000 credit for erroneous telephone charges dating back several years. The company never ordered or had any use for the particular services.  In this article we will give you some “tips”. Here’s your first one. Telephone companies typically state that you must file a claim for disputed charges within 60 days. Tip: the statute of limitations for California extends back 2 years. So don’t accept the telephone company’s standard position.


Who shot the Sheriff? A report in Billing World explained that a sheriff’s office had a direct line to the home of a sheriff who died in 1963. The line did not carry a call for 24 years, yet the county government was still billed because no one canceled the service. Tip: Make sure you cancel in writing services no longer used. Failure to cancel does not excuse your liability and without supporting documentation the telephone company may deny any claim.


A network company upgraded a local customer’s communications system but failed to cancel the old lines. Both old/new lines were billed direct to the customer who blindly paid both for the next two years. Tip: Just because the telephone bill total this month is similar to last month’s, don’t assume it is correct. Last month’s bill could have been wrong. This is how errors go unnoticed for years..


A staff member left a local company but did not hand back the company cell phone, which he continued to use for several months .His ex-employer unwittingly paid hundreds of dollars in calls and rental until an audit uncovered the oversight. The ex-staff member was contacted, returned the cell phone and reimbursed the company.  Tip: Check that calls billed to company cell phones are business calls made by bona-fide users.


Businesses can receive several separate telephone, cell phone, pager, internet bills each month, each bill running to several pages. Multiply the number of bills by the number of pages, that’s a lot of paper bills to check every month. We heard of a novel way that one large city company paid their monthly bills. They received a monthly master bill for 700 cell phones, a stack of paper 3 feet high! The managers responsible for checking the bills measured the height of the stack each month, and if it was within height thresholds they paid it. Tip: We don’t recommend this payment system.


The billing industry has identified a list of “top” problems; 1) Incorrect customer records, 2) Incorrect rates applied, 3) Non billable calls, duplicate calls, incomplete calls, local calls charged as toll calls, 4) Inadequate testing of billing software, 5) Recurring errors. Tip: If you report an error to your telephone company, check the bills closely for the next few months to make sure it has been remedied and does not re-occur.


There are “hidden” charges to watch out for. If you dial *69 Call Return or *66 Repeat Dialing, you are charged $1.25 each time you use these features. If you call a landline from a cell phone in the US, some telephone companies charge a fee for allowing the cell phone connection. When you dial from a cell phone, charges can start as soon as the remote telephone rings, even if it is never answered. Tip: Check your call plan contract and make sure you understand the hidden costs.


Federal excise tax appears on both your local and long distance phone bills.

The tax started as a temporary luxury tax in 1898 on the telephone service to pay for the Spanish-American war, revenue now goes to the U.S. Treasury.  Some organizations may be exempt from Federal and State taxes Tip: Check whether you are entitled to exemption and that you have filed exemption forms with the telephone company and are not paying taxes unnecessarily.


The “dial-around” services, such as 10-10-XXX (e.g. 10-10-297) can provide lower long distance rates, but not all do. Be aware that choosing the wrong 10-10-XXX services could cost you up to 1000% more. Also look out for the increasing trend by dial-around services to charge monthly fees, which they may fail to tell you about. Tip: Study your call usage pattern, time of day, number of minutes, local, long distance to calculate the cost-per-minute (CPM). Thoroughly review the CPM of dial-around options. You may need to use more than one telephone company to get optimum rates, depending on call destination and duration.


Telephone company marketing claims need to be studied carefully. A plan currently being promoted locally states “call anyone, anywhere, anytime for 5 cents per minute “ It also clearly states “with no monthly fee”. That’s true, except, to qualify for the scheme, you must also subscribe to another plan, which will cost you  $20.00 extra in additional monthly fees. Tip: Read the small print in promotions before you sign up and avoid being locked in by long-term contracts.


Most billing errors are unintentional. Check your bills thoroughly by line item and periodically undertake an audit. Good luck looking in them thar bills – we hope you strike gold!




Steve Tillotson, is principal consultant at Tillotson Information Services  in Grass Valley, CA.


Tillotson provides business consultancy services including billing audits, and can be contacted on 530-273-6954 or via the Contact Form .



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