Billing errors: You can fight back!

Industry estimates suggest that there are billing errors in 10 to 15 percent of all telco bills. If communications expenses comprise a large percentage of your budget, it may be worth your time to take careful note of what you are paying for, and whether it accurately represents what you should be charged. In some cases, discovering errors can result in sizeable refunds or credits.

For those of you who would like to dive into a bill analysis project, here are some helpful pointers to help you catch some of the most rampant billing issues:



If you disconnect a telephone line, a circuit, or other such service, be sure to get a disconnect order and due date. If possible, it is best to provide your request in writing, directed to a specific person.

Review your future bills to make sure that all associated components of the disconnected service have been removed. If it is not readily apparent on your bills, you can ask for a customer service record (CSR) to be sent to you. These can be difficult to decipher, as they are filled with billing codes, but once you understand some of the basics underlying these reports, you can extract a tremendous amount of information from them.

If you discover that you are paying for services that you no longer have, contact your provider's customer service department immediately. The more information you can provide for them, the more likely you are to receive credit for any previous billings.


If you have entered into a contract with your provider, and you are not getting the rates that were offered under the terms of that contract, you should be entitled to a refund or credit back to the beginning date of the error. If you cannot find a copy of your contract, your service provider should be able to produce one for you.

Whenever you enter into a contract, pay close attention to the language. Some contracts guarantee rates, while others only guarantee discounts. In exchange for these guarantees you may be expected to generate a particular amount of revenue. Be sure to have your salesperson identify what specific revenue qualifies as contributory.

Also, as a measure of caution, pay close attention to renewal clauses. Many service contracts automatically renew for successive terms without proper notification on your part.


Tax exemption can apply to your organization as a whole or to specific services only. If you are a tax-exempt organization it is your responsibility to provide the necessary documentation to your providers. Tax exemptions typically only apply to state (and sometimes local) sales taxes and/or federal excise taxes. Tax exempt services include internet and private line services such as point to point circuits and frame relay.

If you notice that you are being taxed inappropriately, notify your carrier as soon as possible. If you have not filed the necessary documentation up front, then the service providers are not obligated to refund your taxes. In these cases you can go to the respective taxing authorities and recuperate at least a portion of what you have paid (up to three years for federal excise taxes and up to four years for state sales taxes).


Slamming refers to the unauthorized switching of your long distance service. Typically, the new provider will charge you for long distance calls on your local phone provider's bill, often at higher rates than what you paid with your chosen provider. Slamming is illegal and the perpetrators are assessed heavy fines by the federal government.

Cramming is an unfortunate result of a legal practice called "third-party billing." The larger local telephone companies such as SBC, Verizon, etc. have arrangements with numerous companies to provide billing for these companies' miscellaneous services ranging from directory listings to internet web pages. Although the billing practice in and of itself is legal, the means in which these companies obtain your "permission" may not be.

The FCC mandates that your phone company provide you with a toll-free number to reach these third-parties. Usually, you can find this information on the front page of your bill. If you believe you are a victim of either slamming or cramming:

1. Contact your local phone provider that is providing you with the third party charges. Inform them of the circumstances. In some cases, they will offer a temporary credit for current charges due and recourse (send them back) to the third party provider for review.

2. Call the third party and inform them that you wish to cancel service and receive credit for all back-dated charges. They are usually willing to give you up to 6 months' credit without balking. Beyond this, it may take a bit more persistence.

3. As an added measure of protection, you can request third party blocking on your account. If you have multiple accounts, you will need to request it on each of them.

Be sure to clarify with your provider what will be included in blocking third party services, as it may include other services such as collect calls that you may not wish to block.

4. To prevent slamming, you can also request slamming protection from your local service provider. To sum it all up, when working to acquire credits or refunds due, there are three major rules to follow: Document, Document, and Document.

Write down dates and names of persons you have spoken to, and ask for written confirmation of any verbal promises offered.

It is also advisable to get an order or billing ticket number, when applicable. Carriers are more responsive to claims if you do some of the background work for them.

Prepare itemized details, including dates and totals, of incorrect charges. This information can be faxed into the service provider's customer service or billing department.

Lastly, if you are not getting satisfactory resolution for your perceived overcharges, you can file complaints with the Michigan Public Service Co. (MPSC) and the FCC.

For your convenience, both of them have online complaint forms:

MPSC: Select the link to Telecommunications on the left, then follow the prompts to file a complaint.


If this all seems like a tremendous amount of work, you're right. But once errors are cleaned up, a thorough bill review may not be necessary on a monthly basis.

Lori Leugers owns TeleComp Solutions, LLC, a communications consulting firm.

She can be contacted at 231.778.0174 or