Attorney General's News Release

February 17, 2006

Court orders New Hampshire man to pay $59,000 for fraudulently billing Missourians for adult Web services

Kansas City, Mo. — A New Hampshire man must pay the state of Missouri $59,000 for fraudulently billing Missourians for accessing pornographic Web sites they never visited. Attorney General Jay Nixon obtained a permanent injunction containing the penalty against Michael P. Walczak of Bedford and his businesses, Phoenix One Billing LLC, and National One Telecom Inc.

According to the lawsuit Nixon filed in Jackson County in September, Walczak sent bills to Missouri consumers demanding payment for long–distance telephone calls to foreign countries that the consumers did not make, or demanded payment for access to pay–per–view adult Web sites. The payment demanded ranged from about $100 to more than $500. In some instances, the charges were incurred by auto-dialing software installed on computers without the consumers' knowledge.

"Such high-tech shenanigans often count on the consumers paying the bill without challenging the charges," Nixon said. "Fortunately, most of those fraudulently billed did not pay. That does not make Mr. Walczak's actions any less illegal. Being required to pay a $59,000 penalty should make people like this twice about attempting such a scheme."

In addition to the penalty, the order signed by Circuit Judge Kelly Moorhouse prohibits Walczak from billing Missouri consumers for long–distance service or Internet access without their written consent. Nixon said that Walczak engaged in deception and fraud by failing to inform consumers that secretly installed software would launch pop–up advertisements causing long distance and pay–per–call charges, and that he engaged in unfair trade practices by threatening customers when they refused to pay. Only a few of the Missourians who were falsely billed paid the charges, Nixon said, and those customers already have received a credit on their phone bills.

Inquiries from consumers should be directed to consumer@ago.mo.gov or 1-800-392-8222 (from within Missouri) or 573-751-3321 (outside Missouri).

All media inquiries should be directed to Press Secretary John Fougere.

E-mail      Phone: 573-751-8844         Fax: 573-751-5818