Complaints Mount as US Sprint Works to Improve Billing
Every three or four weeks for the past six months, Stefan Grant has received an unwelcome reminder in the mail: a long-distance telephone bill from US Sprint urging him to pay $29.38 or else be referred to a collection agency.
But Grant, a 29-year-old Philadelphia internist, insists that he paid the bill in January and has the canceled check to prove it. To protect his credit rating, Grant has pleaded to countless Sprint customer service representatives, mailed a letter to Sprint’s chief executive and complained to state officials to resolve the problem. All to no avail.
“It’s like hitting one’s head against the wall for extended periods of time,” said Grant, who’s not even a Sprint customer anymore--he switched back to AT&T; several months ago. “I don’t have time to play these games. I don’t want them to ruin my credit rating.”
Grant is one of the hundreds of thousands of US Sprint customers plagued with billing problems in recent months. For some, bills simply have been delayed. In other cases, customers have been overcharged and have had their their accounts turned over to collection agencies by mistake.
Although the fast-growing long-distance company said it has taken steps to remedy the situation, the billing snafus--besides frustrating customers--contributed to a $76-million loss in the second quarter and the departure of Sprint’s president in early July.
The problems stem from the difficulty Sprint’s corporate parents, GTE Corp. and United Telecommunications, have had in merging their billing and accounting systems since they established their joint venture in the long-distance business last year.
Kansas City, Mo.-based Sprint, whose customer list has doubled during the past year, estimates that 10% to 20% of its 5 million subscribers have experienced billing errors.
At the Federal Communications Commission, which regulates long-distance carriers, complaints against Sprint during the past two months are “significantly higher than other carriers,” said Greg Vogt, chief of the FCC’s enforcement division. Nearly 25% of the 110 complaints the agency receives each week concern Sprint, up from the weekly total of five or so that the carrier used to chalk up.
“Customers are obviously confused,” Vogt said. “That concerns us.”
Increase in Complaints
California regulators also have noticed an increase in Sprint complaints. “It’s been bad,” said Carole Kretzer, a spokeswoman for the California Public Utilities Commission, whose representatives met with Sprint executives two weeks ago to discuss the problems. Kretzer said Sprint officials told the PUC that $8 million of payments had not been posted to customer accounts and that employees were processing checks by hand.
“People say that they have sent in checks, and three or four months later they are getting bills saying they owe money,” Kretzer said.
Said Dennis Bosh, 43, a Los Angeles accountant: “It’s irritating from a customer’s standpoint when you get billed for something you already paid.” Bosh has been billed twice for calls he made in June, and six months ago he received a bill with $120 in overcharges that took three months of phone calls and letter writing to clear up.
“The lines work very well,” said Bosh, “I just hope they get their billing problems corrected.”
Regulators themselves are not immune to Sprint billing problems. Sandra Guthorn, a lawyer with the Maryland Public Utilities Commission, said that she gets three or four Sprint bills a month, and they usually are at odds with each other.
And the problems have not been limited to residential customers--businesses also complain of billing foul-ups. Richard Davenport, an accounting manager at Fox Industrial Sales of San Francisco, said his company’s Sprint bills usually are late and littered with charges for calls made months before.
“Whenever I get the Sprint bill,” he said, “I kind of groan to myself.”
Sprint readily concedes it has had billing problems. But, said Christopher Clouser, a Sprint senior vice president, “We’re not talking about a great majority of our customers being affected.”
“The billing problem will be solved in the very near future,” he said. “It’s been difficult in some areas, but the solution is in sight.”
Sprint customers have received a notice in their most recent bills stating: “We expect to be back on schedule with billing by the end of August.”
Partly in response to the billing problems, Sprint’s former president, Charles M. Skibo, was replaced by Robert H. Snedaker Jr. Snedaker has said his No. 1 objective is to shore up the company’s back office operations.
Besides reconciling its two billing systems, Sprint has hired more customer service representatives to provide faster service. But trying to reach a Sprint customer service representative is easier said than done: During one afternoon last week, it took a reporter 20 phone calls and 30 minutes on hold before reaching a customer service employee.
Customer complaints are nothing new for company officials. GTE Sprint, which merged with US Telecom last year to form US Sprint, has had a history of billing problems in California:
Because of a computer snafu, GTE Sprint customers who made phone calls on Thanksgiving and Christmas Day in 1984 were billed at a higher rate than the discounted evening rate they were supposed to receive. GTE Sprint corrected the bills of only those customers who complained.
But, as a result of a class-action suit filed in Los Angeles Superior Court by the Center for Law in the Public Interest, GTE Sprint--without admitting any wrongdoing--agreed to make refunds to overcharged customers. In addition, $1 million will be donated to a trust fund to be used for financing consumer research and advocacy.
In late 1985, prosecutors from the San Mateo County District Attorney’s office and the state Attorney General’s office sued GTE Sprint, claiming the company had connected customers without their approval and failed to disconnect service within 30 days. Sprint paid $500,000 to the state and county to settle the suit.
Errors commonplace
US Sprint is hardly the only long-distance company making billing errors. In fact, such errors have become so commonplace that it has created business opportunities for other firms. For instance, San Rafael-based Bill Correctors specializes in finding mistakes in phone bills. “We are so confident that we can find errors in bills from companies like MCI and Sprint that we work on a contingency basis,” said Bill Schwartz, a company vice president.
Mistakes in phone bills might be more common than some consumers suspect, said Lisa Foster, a lawyer with the Center for Law in the Public Interest in Los Angeles. Phone bills generated by computers, she said, “have an aura of legitimacy, we all look at them and say ‘they must be right.”’ As a result, she said, “consumers are less vigilant and somewhat intimidated.”
But some Sprint customers are not so complacent.
“If they can take their sweet time billing me,” said a San Francisco music producer whose Sprint bills have arrived three months late, “I can take my sweet time paying them.”
