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Crime

Montana Family Allegedly Involved in Elaborate, Nationwide $70 Million Phone Bill Scheme

Jan. 21, 2013 10:45pm

HELENA, Mont. (TheBlaze/AP) — A Montana family and their accountant are accused of hitting customers with $70 million in bogus charges on their phone bills nationwide, then funneling some of that money through a religious organization to buy land and pay for the husband’s legal bills.

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, according to a civil complaint filed this month by the Federal Trade Commission.

When customers complained or phone companies grew suspicious about one of the Sanns’ companies charging phone bills, they would switch over to another company, the complaint says.

The FTC is asking a judge to issue a preliminary injunction that will force the Sanns to stop operating the companies and freeze their assets. In a court filing Friday, Sann’s attorney, Sarah Rhoades, asked U.S. District Judge Dana Christensen for a stay in FTC civil action, saying there is a criminal investigation already under way.

Allowing the government to pursue both criminal and civil cases against Sann and his companies is improper, Rhoades said in the filing. The civil case would let the government examine company information that it is not entitled to under criminal procedure rules, she wrote.

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. In those instances, the money first was deposited in the bank account of Bibliologic, a religious organization set up by Sann and Braach.

Bibliologic Ltd was incorporated in 2009 as a charitable religious organization without any members, according to Montana Secretary of State registration records. The organization has no physical address.

Steven Sann recently reached a plea agreement with federal prosecutors investigating large medical marijuana operations. According to a federal affidavit, he was an investor in two medical marijuana dispensaries.

Sann struck a deal with prosecutors in September to plead guilty to conspiracy to maintain a drug-involved premises. He had been scheduled to be sentenced on Thursday, but his attorney in that case has asked for a delay because of illness.

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. The companies are American eVoice, Emerica Media Corp., FoneRight, Global Voice Mail, HearYou2, Network Assurance, SecuratDat, Techmax Solutions and Voice Mail Professionals.

The charge is typically $14.95 and appears near the end of the phone bill month after month until the customer notices and challenges it.

Hundreds of complaints have been filed against the Sanns’ businesses with the FTC, the Better Business Bureau and with phone companies, the FTC complaint says.

Of the $70 million billed since 2008, the Sanns’ companies have returned more than $40 million after customer challenges, according to the FTC complaint. But data collected by the federal agency show many more don’t know that they’re being charged.

Last April, the Sanns’ companies had 119,810 voice mail accounts open, but only 12 customers actually accessed their accounts. From March 2010 to April 2012, fewer than 1 percent of the people purportedly with voice mail accounts through the companies actually accessed them.

“These abysmally low usage rates strongly suggest that consumers neither ordered the services nor knew they were being billed for them,” the FTC complaint says.

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Comments (30)

  • RodT82721
    Posted on January 22, 2013 at 12:18pm

    This crook is just another thief that found out how easy it is to scam the public today.
    People have phone bills, that are many pages of billing, with lots of unreadable or hiden billing for everyone from the provider to the Feds.
    The more complex the bill, the easier to hide things.

    People are falling for this new wonderful deivce, that used to be used only to talk to people, called a phone, but now it’s a smart phone! Yahoo free at last!

    Now you get your TV, surf and shop the internet, take pictures of your self and delight you friends, text and donate funds to deserving groups. Now you can even pay for things you don’t need, at the site of the sale, for the low, low price of only 2.7%! Now who could not see the benefit in that? I wonder how much of a howel would go up, it your state added ONLY a 2.7% surtax on gasoline, on top of everything else?

    All with a simple little devise that used to be used to talk to people for about $20.00 a month.
    Now people are going bankrupt with the over use of their wonderful smart phone.
    I love that label, “Smart Phone”, it’s to bad there are far to few smart phoners.

    Report this comment

    RodT82721  
  • RaydocX
    Posted on January 22, 2013 at 10:43am

    curious that no mention is made of the nation’s service providers being told to flag that charge on every involved phone number and check with their customers about the veracity of the charge…

    instead, this ‘nannystate’ government is leaving it to you and me to check our phone bills, which means that thounsands will not check, and the money will continue to roll in.

    it will be interesting if they actually called the involved people and somehow got ‘permission’ to make the charges… there are cases of companies specifically named to allow that… when a cold call asked ‘do you want to change your company,’ and the customer ansers, ‘i’m happy with what i’ve got,’ the company ‘i’m happy with what i’ve got’ then took over billing until caught, as an example.

    if they did not contact and get some sort of ‘permission’ from the numbers (anyone answering can give that permission, curiously), there will be serious charges… if they took that step, it may be a cease and desist, but we cannot prosecute situation.

    And those asking how it is different from local state fed taxes (or the surtax for emergent systems, rural communities and those who ‘can’t afford’ phones that applies to the phone bill monthly) understand the truth… it’s ok when the government does this… just not when unscrupulous but enterprising individuals do so…

    Report this comment

    RaydocX  
    • JediKnight
      Posted on January 22, 2013 at 11:55am

      If you don’t notice a $15 additional charge on your phone bill, you have a problem. I noticed when my cable provider tacked on an extra $3 for cable modem lease (I own my modem). I would hope people would notice a sudden increase and at least look at their bill.

      I had honestly expected the charge to be far less. It’s the $1-$3 charges for everything from interstate subscriber to 911 fees that I can never keep up with (and they change from time to time).

      Report this comment

      JediKnight  
    • SimpleTruths
      Posted on January 22, 2013 at 1:47pm

      How is it a “nannystate government” if they leave it to you to find errant charges? That makes no sense, it sounds like you either don’t know what a nanny is or you just throw that word out there without thinking about what you’re saying.

      Report this comment

      SimpleTruths  
  • rosegrower
    Posted on January 22, 2013 at 10:36am

    How many of those scammed customers had Obamaphones? Since these customers aren’t paying their own bills, it’s likely that none of them ever check charges that are added.

    Report this comment

    rosegrower  
    • SimpleTruths
      Posted on January 22, 2013 at 4:46pm

      First of all the phone program you seem to think was Obama’s idea was initiated by Ronald Reagan, check your facts. Secondly, qualified recipients of these phones (very basic phone, no frills) do not receive a statement so they wouldn’t have the ability to check on the charges.
      Fail and fail.

      Report this comment

      SimpleTruths  
  • Gonzo
    Posted on January 22, 2013 at 10:25am

    The thing I always wonder about these scams (especially Madoff), they have to know they will eventually get caught. Why not disappear after you’ve pocketed say $40 million? They never know when to get out.

    Report this comment

    Gonzo  
  • hauschild
    Posted on January 22, 2013 at 8:52am

    How is this any different than the federal tax code???

    Report this comment

    hauschild  
    • turkey13
      Posted on January 22, 2013 at 10:36am

      Wow! They not only ripped off the folks for 70 Million, they didn’t pay any taxes since it went through a church. When Jesus said, “Render to Caeser what Caeser is due he meant it. Our church (Church Of Christ – one cup – one loaf) doesn’t have a tax exempt # for this very reason. There is Pennacoastal church here in our town that is controlled by a grand father and all his kids and grand kids just endorse their checks over to the church and are paid cash and file no tax returns.

      Report this comment

      turkey13  
    • saranda
      Posted on January 22, 2013 at 12:04pm

      @turkey13 – and then there are entire religions that collect tithing and invest in malls, radio stations, publishing, etc and make claims about charitable giving that actually amounts to a very small amount of money (especially when determined on a per member basis). Churches should not be tax free except on that required for upkeep and normal maintenance, and perdiodically capital costs for new locations. But to get to invest in for profit businesses and get to avoid tax is just immoral.

      Report this comment

      saranda  
  • FoxRules
    Posted on January 22, 2013 at 8:44am

    REACH OUT… REACH OUT, AND TOUCH SOMEONE! Takes on a whole new meaning here, guess the White House will be weighing in on this and viola before you know it, they’ll be another new revenue stream DC bound?

    Report this comment

    FoxRules  
  • THX-1138
    Posted on January 22, 2013 at 8:28am

    How do you get the “word on the street” from your mom’s basement?

    Report this comment

    THX-1138  
  • asybot12
    Posted on January 22, 2013 at 2:48am

    Please everyone don’t react and waste your time on lid.smoker he is on all stories just getting people pee-oed he is a troll of the worst kind

    Report this comment

    asybot12  
  • blackyb
    Posted on January 22, 2013 at 12:35am

    That is a bit steep.

    Report this comment

    blackyb  
  • Chuck Stein
    Posted on January 22, 2013 at 12:10am

    LOL “Find out how they did it” — sounds like a pitch for a “work from your own home” operation.

    Report this comment

    Chuck Stein  
  • QuincySmith
    Posted on January 22, 2013 at 12:07am

    Just glad I don’t live on your street!

    Report this comment

    QuincySmith  
  • BODYBAG
    Posted on January 21, 2013 at 11:31pm

    LOL

    Huggy Bear

    Report this comment

    BODYBAG  
  • The Big Mick
    Posted on January 21, 2013 at 11:30pm

    What would be the Argument against this?

    Report this comment

    The Big Mick  
  • Armyduderetired
    Posted on January 21, 2013 at 11:10pm

    Yeah what’s the difference of this and what the city state and fed tack on to the bottom of the bill. Oh by the way, the free phones program is over. Those useful idiots are no longer needed. Suckers!

    Report this comment

    Armyduderetired  
  • sparkyrules
    Posted on January 21, 2013 at 11:00pm

    But its okay if the Feds do it with a ‘Universal Service Fee’ on everybody’s bill.. Gotta pay for those ‘Obama Phones’ ya know,and who knows what else..

    http://www.americanthinker.com/2012/09/your_universal_service_fee_at_work.html

    Report this comment

    sparkyrules  
    • Al J Zira
      Posted on January 21, 2013 at 11:17pm

      I read a story similar to that before. Every time it will mention how the program was started under Reagan as if that should matter. No matter who started the program it’s still not right but leave it to Obama to make a total mockery out of it and turn it into a governmental beast.

      Report this comment

      Al J Zira  
    • CatB
      Posted on January 21, 2013 at 11:45pm

      Yes .. and all the other fees and such .. you try to call and ask what they are half the time the person who works there either doesn’t know or won’t tell … I now have a prepaid phone .. I don’t pay a monthly fee .. just load minutes when I need to.

      Report this comment

      CatB  
    • 1TrueOne55
      Posted on January 22, 2013 at 2:40am

      They finally retired the bill for the Spanish-American War phone bill. I should ask for a refund since I was not alive when that war was enacted. And for all the years they collected the bill without removing it I am sure that there would be some serious hole in Obama’s budget. Could be 25million+ per year etc but someone would have to really figure out the real refund value…

      Report this comment

      1TrueOne55  
  • TotallyNotATroll
    Posted on January 21, 2013 at 10:59pm

    Thank god for prepaid phones….

    Report this comment

    TotallyNotATroll  
  • soybomb315_II
    Posted on January 21, 2013 at 10:48pm

    I clicked on this story cuz i thought they were talking about Joe Montana…..PHEW!

    Report this comment

    soybomb315_II  

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