What's happening
This bill bans certain unfair charging practices by prepaid calling card companies and increases penalties for violations.
Why it matters
Prevents deceptive billing practices. by prohibiting prepaid calling card companies from rounding up call times beyond the next minute, ensuring consumers pay only for what they actually use.
Eliminates unfair charges. for calls that are not actually connected, such as unanswered calls or busy signals, protecting customers from losing prepaid minutes for services not received.
Tackles misleading advertising. by making it illegal for companies to claim “no connection fee” in ads if there is actually a disconnection fee, helping consumers make more informed choices.
Significantly increases financial penalties. for violations, raising the maximum fine from $1,000 to $5,000 for a first offense and to $10,000 for repeat offenses, creating a stronger deterrent against unfair practices.
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Who cares
Headline styles
Limit Prepaid Card Fees
Plain English, a few words. Used as the page title.
Sponsors
Senator · Senate District 29
No co-sponsors yet.
History
- Referred to energy and telecommunications
- Referred to energy and telecommunications
Full text
1 pageUnderlined is new[Struck] is removedOfficial text on nysenate.gov ↗
STATE OF NEW YORK
2063
2019-2020 Regular Sessions
IN SENATE
January 22, 2019
Introduced by Sen. SERRANO -- read twice and ordered printed, and when printed to be committed to the Committee on Energy and Telecommunications
AN ACT to amend the public service law, in relation to limiting certain charging practices by companies that provide prepaid telephone calling cards and increasing fines for violations of limitation requirements
The People of the State of New York, represented in Senate and Assembly, do enact as follows:
Section 1. Section 92-f of the public service law is amended by adding a new subdivision 4-a to read as follows:
4-a. No company that provides prepaid calling services through prepaid calling cards shall:
a. calculate usage charges by rounding up beyond the next minute for telephone phone calls;
b. charge minutes for unconnected telephone phone calls, including calls that are dropped or to which there is no answer or a busy signal;
c. publicize or display advertisements stating that there is no connection fee associated with a plan or calling card if there is a disconnection fee associated with the plan or calling card.
§ 2. Subdivision 8 of section 92-f of the public service law, as added by chapter 651 of the laws of 1999, is amended to read as follows:
8. Enforcement. The commission shall have the power, consistent with federal law, to assess a penalty not to exceed [one] five thousand dollars against any company that provides prepaid calling cards or services that knowingly fails or neglects to comply with any provision of this section or any regulation or order of the commission implementing or enforcing the provisions of this section for a first violation and ten thousand dollars for a second or subsequent violation. All moneys recovered from any administrative penalty shall be paid into the state treasury to the credit of the general fund.
§ 3. This act shall take effect on the one hundred twentieth day after it shall have become a law.
EXPLANATION--Matter in italics (underscored) is new; matter in brackets
[ ] is old law to be omitted.
LBD03560-01-9
Reflowed for reading: line numbers and page breaks removed. Cite the official text.
Sponsor's memo
Title of bill
An act to amend the public service law, in relation to limiting certain charging practices by companies that provide prepaid telephone calling cards and increasing fines for violations of limita- tion requirements
Purpose
To enhance consumer protection in prepaid calling cards.
Summary of provisions
Creates a new subdivision 4-a of Section 92-F of the public service law to prevent companies from:
-Calculating for usage charges by rounding up beyond the next minute.
-Charging for unconnected calls.
-Publicizing a connection fee if there is a disconnection fee.
The bill also increases penalties for violations of the act.
Justification
Calling cards are often used by new immigrants with families and friends abroad and by friends and families of military personnel as a means to make inexpensive phone calls overseas. Unfortunately, due to unscrupu- lous practices many consumers get less than what they bargain for. For instance, many calling card companies round up to the next 3 or even 5 minute increment, while others advertise that there is no connection fee for a call, but then charge a disconnection fee. A study by Consumer Reports helped to unveil some of the unscrupulous practices that result in calling card consumers getting less than what they bargained for. Among a few of their findings:
-Of the 130 calling cards purchased about three quarters of the cards didn't disclose the proper rates.
-Many of the cards had unclear post-call fees, periodic fees, and surcharges.
Other calling cards that did display fees or disclosure information did so in font so small that a magnifying glass was needed. This bill seeks to put an end to these problems by establishing fair standards and enhancing the disclosure requirements so consumers have a clear under- standing of what they're getting when purchasing calling cards.
Legislative history
2013-2014: S.3729 - Referred to Energy and Telecommunications 2015-2016: S.1176 - Referred to Energy and Telecommunications 2017-2018: S.3451 - Referred to Energy and Telecommunications
Fiscal implications
None to the State.
Effective date
This act shall take effect 120 days after it shall have become a law.
Summaries, headlines and scores are AI-generated from the official bill text. How we score bills. Source: NYS Open Legislation.