Pacific Bells Seeks Customers Due Refunds Over Unwanted Services

Ordered by state regulators to try again, Pacific Bell is attempting to find 80,000 Orange County customers who may qualify for refunds on optional services that they paid for but never requested.

Most of the eligible customers are low-income residents, particularly minorities and senior citizens, company officials said. They are among the hundreds of thousands of Pacific Bell customers throughout California who, according to a 1986 ruling by the state Public Utilities Commission, purchased such services as call-forwarding, three-way calling and speed calling after company personnel “bundled” such options with basic service in potentially confusing sales pitches.

Pacific Bell shareholders--not company ratepayers--are paying for the refunds, which have totaled $32 million throughout the state since 1986, officials said.

“We feel very badly about what has happened,” said Linda Bonniksen, a Pacific Bell spokeswoman in Orange County. “We know that our reputation was hurt, and we don’t want to be in that situation again. We want people to feel good about doing business with us, and we’ll do cartwheels to make sure they feel that way.”

Since last month, Bonniksen said, about 8,450 low-income and Spanish-speaking customers in Orange County have been contacted by phone. About 75,000 notices have been mailed to customers thought to be eligible for the refunds but who didn’t respond to the company’s first such campaign two years ago. A similar program is being implemented statewide.

Bonniksen said the first refund campaign--conducted in 1986--resulted in the company paying about $3.2 million to more than 33,000 Orange County customers. Refunds averaged $90.

But the PUC determined that the notices sent to all 750,000 Pacific Bell customers in Orange County during the 1986 campaign, as well as those sent to all 8.5 million customers statewide, were ineffective in alerting them to the possibility of a refund. Chris Ungson, a PUC analyst in Los Angeles, said that a new refund notice was designed and that Pacific Bell was ordered to undertake its current campaign.

“We felt that it (the first effort) was not as effective as it could have been and that a second refund campaign was required,” Ungson said, adding: “Around one-third didn’t even open their envelope. It just got tossed. Of those who opened theirs, there was a significant amount of confusion as to the message.”

According to Bonniksen, Pacific Bell “really canvassed the planet in Orange County” when it set out to find refund candidates two years ago.

She said the response may have been low because “there aren’t that many people who qualify for a refund, or there aren’t that many who are interested.”

Pacific Bell isn’t certain about who specifically was misled when purchasing service in 1985 and 1986, she said, but “they tend to be customers who least understand the telephone company business. It’s not that they lack sophistication or intelligence. It’s just that it’s now a very complicated industry.”

The company believes that senior citizens may have had trouble understanding their service options because at one time, telephone service was much less complex, Bonniksen said. Minorities, on the other hand, may have been stymied by a language barrier, she added. The company’s current refund campaign in Orange County is being conducted in English, Spanish, Korean, Vietnamese, Laotian, Cambodian and Hmong.

“We don’t want to leave any stone unturned,” Bonniksen said. “We’re dealing with a very difficult part of the market.”

Do Ngoc Yen, a leader of Orange County’s Vietnamese community and editor of Nguoi Viet, a Vietnamese-language newspaper, said he didn’t know of any Vietnamese residents who claim to have been misled when purchasing phone service several years ago. Nor was he aware of Pacific Bell’s current refund campaign or of its impact in the Vietnamese community.

For the refund effort, Pacific Bell compiled a list of customers with the company’s basic low-income service--Lifeline--as well as customers in zip code areas with large concentrations of minorities and the elderly.

Anyone on the list who also had the company’s custom-calling services in 1985 and 1986 but didn’t come forward in 1986 was targeted this time, Pacific Bell spokeswoman Dianne Wentworth said.

Unlike the first campaign, which was aimed at all Pacific Bell customers throughout the state, the new program is narrowly focused, Wentworth said, because “we don’t want to confuse people who aren’t eligible for refunds.”

Pacific Bell’s Bonniksen said that some ineligible customers have obtained refunds but that she did not know the number of such cases or the amount of money involved.

“We’re not going to be able to completely ensure that people who don’t deserve refunds don’t get them,” she said. “But we’re learning by our mistakes. . . . We made a mistake two years ago, and we’re willing to take risks.”