Surely, I'm not the only soul who in a moment of fiscal stress has found him- or herself in a call centre punching in phone numbers and hoping the whole thing isn't a scam. But how many telemarketing newbies actually get a chance to bust their bosses? This is the story of how a lousy day job turned me into an accidental sleuth. It was last August, and I was sitting in a boiler room on Scollard Street in tony Yorkville, trying to earn the promised $10 to $18 an hour for a company called Global Healthcare.
I was stationed at one of 20 computers with wires hanging off the edge of the desks, in a noisy fluorescent-lit office where staff were primed to pitch a medical discount card to Americans. The service allegedly gave 70 per cent discounts off dentists' bills and 50 per cent off chiropractic services, glasses, non-prescription drugs, etc, supposedly redeemable at reputable companies like Wal-Mart and Tops Pharmacy.
I was immediately skeptical about the process, but silly me, I thought it was just an unusual marketing pitch. It took some time to really understand the full implications of the script Global managers were pressing me to use. What I didn't know until my first paycheque arrived was that Global Healthcare was linked to MedPlan Inc., a commercial enterprise that was keeping state attorney generals' offices busy in Florida, New York, Rhode Island, Wyoming and Michigan.
And I certainly couldn't have foreseen that my own affidavit filed in a circuit court in South Dakota would be the clincher in a civil case declaring MedPlan "unlawful" and "deceptive."
Day by day I called Americans and made my pitch as instructed. "Hello: Get a pen and paper. We're sending an important package to you." Not allowed to explicitly tell the consumers that we were selling anything, we could only say we had to verify their chequing account, a point I made in my affidavit.
Staff were given lists of banks and credit unions in each state, including route and branch numbers. So if the respondent mentioned a bank's name, the telemarketer could easily match the name/address of the bank in their city. This gave the impression that Global Healthcare already had the account and that the respondent just had to verify the rest of the number.
I observed that once the front-line telemarketer got the bank account number, a supervisor would take over the phone call to re-confirm all the consumer's information -- on tape. I described all this in my affidavit -- how we were encouraged to get a rhythm going with the caller, saying "yes" to all their personal information so they wouldn't listen and would automatically agree to an "activation fee." Often the customer didn't understand that the activation fee was actually $359 being taken out of their account.
Curious about whether my skepticism had any basis, I began an Internet search. I hadn't yet scored a sale, and when I discovered sites full of consumers complaining that they didn't know they'd authorized the removal of money from their account, I was pleased with my poor sales record.
Suddenly, I was doing a different kind of soliciting, furiously seeking out those who believed they were victims. It became a way of making things right. I discovered, for example, Cindy Craig of Illinois, who told me her elderly mother had had her chequing account debited without her knowledge. "We were finally allowed to listen to the call. The rep never once mentioned that the fee would be automatically deducted," Craig tells me. After many attempts, MedPlan eventually returned the money. Many, many others weren't so lucky.
I lodged a formal complaint with the U.S. Federal Trade Commission and discovered that U.S. state and federal law enforcement agencies were chasing MedPlan but were unaware of the name change to Global. When I contacted the Toronto police service's fraud squad and consented to give a sworn statement on videotape, I was told, "Don't expect us to make arrests or close the place down. We need victims and we don't have any. Besides, who will pay for U.S. citizens to come up to Canada?"
RCMP sergeant Guy Roberts, who investigates telemarketing fraud, told me he has never seen the federal police force lay criminal charges in a case involving U.S. citizens. "It's not a priority relative to other things we have to deal with." Over at the Ministry of Consumer and Business Affairs, Barbara Allen sounded frustrated: "Many of these companies operate without a licence from us," she says.
PhoneBusters in northern Ontario, which is financed by the OPP's anti-racket squad and the RCMP, said it has known about MedPlan for over a year, but all it can do is monitor and share info with U.S. authorities.
The last Canadian law enforcement arm I contacted was the federal competition bureau, which took four months to respond. When it did, investigators enthusiastically received the internal company documents I provided -- paperwork with different company names, the telemarketers' script and banking information with my paycheque.
At one point I was sharing documents with 25 state attorney generals' offices. In South Dakota, an investigator successfully obtained a circuit court decision to seize MedPlan/Global files, and on January 23 that state's curcuit court ordered the owners to cease all operations.
Finally, two weeks ago, five months after I began this crusade, the U.S. Federal Trade Commission succeeded in asking an Illinois district court to temporarily halt the enterprise and freeze the owner's assets. On the same day, Canada's competition bureau finally spoke, and though the courts will make their final determination, the bureau has laid criminal charges against MedPlan/Global operators.