The Big Mobile Phone Ripoff

By Jamie Douglas

First off, I would like to thank all the readers who responded so positively to yesterday’s article, and those of you who were rightfully outraged at the slap of the wrist punishment meted out to the Marine who was responsible for the murder of 24 Iraqis. And I also want to thank the handful of vitriolic “patriots” who attacked me for bringing up the court martial of the young airman in Wichita. Those asking for proof should instead ask proof of their usual news sources such as the New York Times, New York Post, Fox News, Washington Times etc.

Now on to a subject affecting nearly all of us expats, at least all those of us using cell phones or “handy’s,” no matter what part of the planet we live on. Those of us living in the Americas are victims of one of the biggest commercial frauds ever perpetrated on the world’s consumers, and it all started when, in the 1990’s, Mexico’s ruling party, the PRI, sensed that they would not be able to hold on to power much longer, and went on a privatization binge that included the outmoded national telephone monopoly, Telmex.

The then 50 year old PRI-connected Carlos Slim Helú, the son of Lebanese immigrants, had positioned himself to acquire the company by means of leverage and heavy borrowing from the government of Mexico itself. Today he is the richest man in the world, and he did it mainly on the backs of the poor citizens of the Americas, having deliberately overcharged his customers by US$13.4 billion per year in Mexico alone between 2005 and 2009, stealing the equivalent of 1.8% of Mexico’s GDP.

But his grip goes much deeper than Mexico. He is represented in virtually every nation on the American continent, including most Caribbean islands, Puerto Rico and Jamaica being just two examples. He is deeply involved with Verizon and their worldwide expansion plans and with his huge horde of cash, he is now looking to bring his robber baron business model to the continent least able to afford his rip-offs: Africa.

For years, Telmex under his leadership blocked VOIP calling to and from Mexico while he built up a network of wireless systems that were designed from the outset to rob the user. I spent many years in Mexico, during which time I had to buy phone card after phone card, using the internal timer on the phones to keep track. I never once got even close to the amount of time I purchased. And it had nothing to do with rounding up. It was just a fraudulent system. Local calls to a phone from the same company were billed at outrageous amounts, and there was no one to complain to. The only places selling phones and cards were privately owned, and the customer service lines were a joke. The cell phone bill was one of my biggest monthly expenses.

I now live in Argentina, where the nearest tower has only one Claro repeater. I depend on Claro for Internet and, until recently, cell phone service. Last May when I signed the contracts for my 3G Internet, the cost was listed as “Summary of fixed monthly charges: AR Pesos 127.03.”

I went to pay my bill today and it was AR Pesos 226.31. Inflation! The man behind the window said to look at my 17-page contract, which was printed out on a laser printer that was out of toner in one of the smallest fonts possible, about 4 or 5.

Now I am obviously not the only one getting my clock cleaned. And Claro is not the only firm following the business model of Carlos Slim Helú. Every single wireless company in the Americas operates under the same business model, but he stands out amongst other telcom robber barons for having become the world’s richest man, in the process acquiring an astonishing US$ 63.3 billion by having been a very sharp investor, taking advantage of the downturn of the Mexican economy between 1982 and 1985. He used his money and connections to purchase many important and influential businesses, using the cash flow generated by his acquisition of British American Tobacco, as well as partnering with Télécom France and Southwestern Bell to buy Telmex.

So while Slim is getting fatter every day, his victims/customers are paying a little more every day. It’s trickle down inflation, stupid!

Jamie Douglas

San Rafael, Mendoza

[image: Carlos Slim Helú, via Wikipedia]

I encourage you to write to me, jamie@expatdailynews.com with any questions or suggestions you may have. Disclaimer: I am not in any travel related business. My advice is based on my own experiences, and is free of charge. (Donations accepted). It is always my pleasure to act as a beneficial counselor to those who are seekers of the next adventure.

To read more of Jamie’s opinion articles, see Voices From Exile. You can also contact Jamie at jamie.douglas [at] yahoo.com

See more expat articles at Expat Daily News Latin America