Helena, MN – A $70 million phone charge is part of a police investigation into a Montana family that falsely charged their customers extra phone charges in order to line their pockets. A Federal Trade Commission civil complaint says Steven Sann, his wife Terry, son Nathan, and accountant Robert Braach run a maze of nine companies engaged in “cramming,” or adding unauthorized charges to a customer’s phone bill.
The Huffington Post explains the essence of this family’s crime and how cramming works:
“The Sanns’ nine companies are voice mail and electronic fax services that charge a customer’s phone bill through an intermediary called a bill aggregator.”
For example, last year Sanns had over 100,000 voicemail accounts open, but only 12 of his customers actually utilized the service. The FTC claims that customers of Sanns’ companies didn’t request the additional phone services given how low their usage rates were. The extra $70 million phone charge was simply pocketed by the family.
The FTC believes these facts suggest that the Sanns were hiding the $70 million phone charge scheme in plain sight:
“These abysmally low usage rates strongly suggest that consumers neither ordered the services nor knew they were being billed for them.”
According to KULR8, the FTC is asking a judge to issue a preliminary injunction to force the Sanns to stop operating and freeze their assets. Steven Sann is the founder of a western Montana youth camp. He also is awaiting sentencing for a drug charge related to his investments in medical marijuana businesses. The family has taken much of this $70 million phone charge and invested it into buying many acres of land. They also created shell companies with no employees to hold some of the money.
Sann’s attorney, Sarah Rhoades, asked a judge Friday to stay the civil action because a federal criminal investigation is already under way. After customers started noticing the scam, challenges began to pile up and $40 million out of the $70 million phone charge has already been returned to customers.