DIRECTV Uncovers Scheme at Texas Call Center to Fraudulently Activate

    Business Editors

    EL SEGUNDO, Calif.--(BUSINESS WIRE)--April 19, 2005--A lawsuit was filed by DIRECTV, Inc. (NYSE:DTV), in U.S. District Court for the Southern District of Texas against 12 individuals, including at least 10 former DIRECTV customer service agents, who it believes engaged in a scheme to defraud DIRECTV by creating subscription accounts with false information and fraudulently linking access cards to existing accounts that enabled others to receive DIRECTV(R) programming without authorization or proper payment to DIRECTV.
    The suit was filed following a lengthy investigation by the DIRECTV Office of Signal Integrity and Legal department into improper activities at a call center in Pharr, Texas, operated by a third-party vendor that is under contract to DIRECTV to provide support for its customers. Investigators determined that no customer information was compromised by the call center employees involved in the scheme.
    According to the complaint, individuals formerly employed at the call center used their positions as customer service agents to create subscription accounts with false information, activated access cards and linked them to legitimate existing accounts by misrepresenting the identity and the relationship of the person using the card and the location of the cards activated by the defendant. DIRECTV also claims the defendants were acquiring DIRECTV access cards to set-up additional bogus accounts and were shipping cards to locations around Texas, as well as to New York, North Carolina and other locations around the country.
    DIRECTV claims the defendants violated the Federal Communications Act, the Electronic Communications Privacy Act (wiretap laws) and Texas state law. DIRECTV claims also include unjust enrichment, tortious interference, civil conspiracy and fraud.
    "This case is significant in that these individuals, by virtue of their positions as call center agents, were able to easily procure access cards and through their knowledge of our billing system, committed fraud on a large scale over an extended period of time," said Dan Fawcett, executive vice president, Business and Legal Affairs, DIRECTV, Inc. "We will continue our aggressive efforts to root out fraud wherever we find it to protect both our business and our customers."
    Defendants in the case are: Jamie Alejandro Cedillo, Victor H. Cantu, Ivan Hernandez, Jose Ontiveros, Christy Y. Balderas, Vanessa Espinoza, Jose Armando Tello, Julia Galaviz, Alejandro Vera, Ruby Yanez, Juan Carlos Carranza, Jorge Quintero, and John Does one through forty-five. The employees implicated in the fraud have been either terminated or suspended by the call center.
    This is the fourth federal lawsuit involving allegations of fraud filed by DIRECTV in the past seven months. In September of last year, DIRECTV sued a Utah couple over allegations of fraud and filed a lawsuit in Florida against seven individuals for the same offense. Last month DIRECTV targeted 19 Canadian citizens and five businesses that it believed were participating in a scheme to activate fraudulent DIRECTV accounts.
    DIRECTV is the nation's leading and fastest-growing digital multichannel television service provider with more than 13.9 million customers. DIRECTV and the Cyclone Design logo are registered trademarks of DIRECTV, Inc. DIRECTV, Inc. is a world-leading provider of digital multichannel television entertainment. DIRECTV is 34 percent owned by News Corporation.

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CONTACT: DIRECTV, Inc. Robert Mercer, 310-726-4683

KEYWORD: CALIFORNIA TEXAS INDUSTRY KEYWORD: COMPUTERS/ELECTRONICS TELEVISION/RADIO CABLE CLASS ACTION LAWSUITS SOURCE: DIRECTV, Inc.

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