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Minnesotans slammed by New Access
by Mark Zdechlik, Minnesota Public Radio
July 21, 2003

New Access Communications has drawn customer complaints from Minnesotans similar to complaints in other states which led to regulatory fines. Gov. Tim Pawlenty had connections to the Minneapolis-based telephone company while he served in the Legislature. New Access officials say the vast majority of their customers are satisfied despite consumer protection settlements in three states and an ongoing investigation in Minnesota by Attorney General Mike Hatch. But critics say New Access misled customers about pricing, and in some cases, took over people's telephone service without their permission, a process called "slamming."

St. Paul, Minn. — Curtis, a liquor store owner from Austin, Minnesota, who doesn't want his last name used, had never heard of New Access Communications until he started getting bills from the company about this time last year.

"We didn't know who it was, so we would just throw them away. We never even knew what was happening," says Curtis.

The bills stopped coming for a while, but then, "We got a phone call saying we're going to disconnect you're telephone line if you don't pay up on these bills," says Curtis. "'Well, what bills is that?' 'With New Access.' We belonged to ATT or Qwest or whatever it was. They said, 'No, you signed over to us.' I didn't remember signing over to them or authorizing a signover."

We belonged to ATT or Qwest or whatever it was. They said, 'No, you signed over to us.' I didn't remember signing over to them or authorizing a signover. ... I wouldn't connect with them again if they give me free phone for a billion years. - Curtis, who was slammed by New Access

By that time, Curtis says New Access was demanding nearly $700. The company said it had proof Curtis agreed to become its customer -- a tape recording of Curtis giving his consent to change his home phone service from Qwest to New Access.

"They did play it for me, but it was so crackly, I couldn't tell myself whether it was me -- or who or what it even was talking about," he says.

New Access cut off Curtis's phone service when he refused to pay, and he says they blocked his line from getting service from a different provider.

"It's pretty near frightening."

Months into the ordeal, Curtis finally called the Better Business Bureau. With the bureau acting as an intermediary, he settled his nearly $700 bill for less than $300. He says $300 was considerably more than he thought he could possibly have, but he just wanted the whole thing over. His home phone had been shut off for nearly a month.

"I wouldn't connect with them again if they give me free phone for a billion years," he says.

Curtis's allegations that New Access switched his phone service without his permission -- that New Access slammed him -- are nothing new to the company or to the Better Business Bureau. The bureau lists New Access as having an unsatisfactory record because of slamming complaints, and allegations of misleading sales tactics, along with billing and customer service problems.

Last year New Access settled consumer protection investigations with regulators in Washington, Oregon and Indiana, paying more than $100,000 in fines and refunding more than $100,000 to unhappy customers.

The CEO of New Access' parent company, Elam Baer, is a longtime political ally and friend of Gov. Tim Pawlenty. He acknowledges some difficulties, but he says the problems were addressed.

"In the context of a very, very rapidly growing company, which we were in in 2001 and 2002, we made some mistakes along the way," Baer says. "When we did, we owned up to those mistakes, and we entered into settlements and we improved our business -- improved processes. And we're a better phone company today than we were two and a half years ago."

Still, according Baer, New Access is the subject of an ongoing investigation by the Minnesota Attorney General's office. The Better Business Bureau says the same type of problems that resulted in settlements in other states have also been the subject of relatively recent complaints from some of New Access' 8,000 to 10,000 Minnesota customers.

I can't speak to an individual case, but what I can tell you is that we've got 140,000 customers worldwide. We're in the business of providing good value local and long distance service to our customers. - Elam Baer, New Access CEO

The Attorney General's office won't comment on its inquiry. The Better Business Bureau won't say how many people have complained, but it furnished Minnesota Public Radio with the names of several disgruntled customers.

"They didn't slam me, I actually signed up for it," says Mary Bergh of Burnsville.

Bergh voluntarily became a New Access customer last summer when a telemarketer told her she could save money by switching from Qwest. For about $30 per month, Bergh says she was told she would get local and long distance phone service, along with features like caller ID and some free long distance minutes.

"It seemed like I got a couple of bills that were OK, but then gradually it just went way up and pretty soon it was like $80 or $90 I believe," she says.

Bergh says New Access even charged her long distance fees for some local calls.

"Like when I called Hopkins, which is in the same area code, I was charged a long distance fee for that. I live in Burnsville," says Bergh.

When she called New Access to complain, she says customer service representatives were rude and had no explanation for the charges. Then her phone line went dead. She says a technician dispatched a week later told her the main phone wires going into her house were incorrectly hooked up.

"I thought that was the most stupid statement I had ever heard," she says.

New Access charged Bergh about $100 for the service visit. When she called the company to complain, she says she was ridiculed for not having purchased a phone line insurance program from New Access.

"They were so rude when I called. I could hear someone laughing in the background, because I was getting angry. I wanted to get my money back -- I thought that was just a ripoff -- that all of a sudden my phone goes out," Bergh says. "I had never had any trouble with any phone in 33 years, especially with wires inside the house. So I wrote to the Better Business Bureau."

With the help of the bureau, Bergh says she got a $50 refund from New Access.

"I can't speak to an individual case but what I can tell you is that we've got 140,000 customers worldwide," says New Access CEO Elam Baer. "We're in the business of providing good value local and long distance service to our customers."

Baer says he thinks the recent news media scrutiny of his company has exaggerated problems and is a politically motivated effort to embarrass Republican Gov. Tim Pawlenty. Until the end of 2001, Pawlenty served on the board of directors of NewTel, the holding company which owns New Access.

"As to the issue of what Tim should have known, one crucial fact seems to have been missed in all of this. And that is -- none of these settlements took place when Tim Pawlenty was on the board of NewTel Holdings," says Baer.

But Pawlenty was on the board when complaints that led to those settlements outside of Minnesota began surfacing. And through September 2002, Pawlenty served as a legal consultant for another of Baer's telecommunications businesses -- a pay phone company called Access Anywhere.

Mary Bergh of Burnsville says despite her bad experience with New Access, she does not fault Gov. Pawlenty for his past business relationships with Baer.

"I really can't blame him per se. I just think that when you are involved with companies you better do better research," says Bergh.

Senate Democrats have scheduled a hearing for early next month to look into Pawlenty's involvement with Baer. They're particularly interested in finding out whether Pawlenty actually earned the roughly $60,000 Baer paid him for legal consulting while he was campaigning for governor.

The chair of the Commerce Committee in the Republican-controlled House says he will wait for the outcome of the Attorney General's investigation before deciding whether to hold hearings.

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