Hidden fees and surcharges that drive up the cost of everything from phone service to concert tickets are spreading like wildfire, creating...

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WASHINGTON — Hidden fees and surcharges that drive up the cost of everything from phone service to concert tickets are spreading like wildfire, creating a nuisance for U.S. consumers and making truth in billing little more than a hollow promise.

Some hotels impose automatic towel, bellman and groundskeeping fees. Airlines charge up to $25 to check an extra bag. Want to terminate your cellphone service? Don’t be surprised by a $200 cancellation fee.

Many of the charges are undisclosed, buried in contract fine print or listed as an unclear line item on a bill.

While the costly fees get our blood boiling, the smaller ones have turned the marketplace into a minefield of nickel-and-dime charges. These smaller fees typically range from less than $1 to roughly $10, depending on the goods or services involved.

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For years, consumers ignored them because they were relatively small and weren’t worth the hassle to fight. But multiply those small amounts by millions of customers and they become a multibillion-dollar corporate windfall.

A 2006 study by the Ponemon Institute, an independent business-research firm, found that the average adult pays about $942 each year in hidden fees and surcharges.

The study’s results are featured in “Gotcha Capitalism,” a new book by consumer advocate Bob Sullivan, who called the fees the “fastest-growing white-collar crime in America,” even bigger than identity theft.

After years of being squeezed, customers are fighting back. Just calling to complain satisfies many people. Others use Internet sites such as Complaints.com, PlanetFeedback.com, Callforaction.org and ConsumerXchange.com to help settle disputes. If those channels fail, they turn to the courts.

Class-action lawsuits, which have numerous plaintiffs, are the preferred choice for fee-based suits because individual cases over small amounts of money aren’t worth the legal fees and aren’t profitable enough for lawyers to pursue.

A federal law that limited securities class actions by shareholders also has caused more lawyers to gravitate toward consumer cases.

“There has a been a significant uptick in consumer class actions as a result,” said Andrew Sandler, a co-chairman of the American Bar Association’s consumer and personal rights subcommittee. “… There’s lots and lots of litigation against financial service [providers], with respect to utility bills, telephone bills, cellphone bills, credit cards, store charges and store value cards.”

The disputes reflect a changing marketplace, in which frustrated consumers are pushing to make advertised prices meaningful again.

“Part of what you’re seeing is a growing resentment of these abuses that are constant in our daily lives,” said Ira Rheingold, the executive director of the National Association of Consumer Advocates.

Commercial banks were on pace to reap $38 billion in fees from deposit accounts in 2007, according to the Federal Deposit Insurance Corp. The entire financial-service sector pockets more than $216 billion annually in related fees, Consumer Reports has estimated.

Corporate America largely dismisses concerns that the extra charges are price-gouging. It defends them as a valid way to cover the cost of providing services and of meeting regulatory requirements, among other things. But problems arise when customers don’t know what triggers the fees.

Many class-action cases begin like the suit that Andrew Jones filed against JP Morgan Chase Bank in December.

Jones, the owner of Woody’s restaurant in Richmond, Ky., says the bank wrongly charged him $30,000 in overdraft fees over several years. Jones’ money problems began when restoring the restaurant cost more than expected, but they worsened, he says, because of how his bank posted debits and credits to his account.

Instead of rejecting transactions for insufficient funds, many banks now cover their account holders’ overdrafts and charge an average of $35 for the service.

Consumer advocates say that banks increase their overdraft fees by debiting larger checks before smaller ones that are drawn on the account in the same period. Doing so assures that a larger number of checks bounce if the client has insufficient funds, resulting in more fees for the bank.

Jones, 39, said that this activity, along with the bank’s failure to deposit his restaurant credit-card receipts in a timely manner, led him to incur many of the overdraft charges.

“There is nothing that … could ever heal the two and a half years of mental and emotional anguish that I endured at the hands of Chase Bank,” Jones said.

As a possible first step toward a class-action designation for the case, Jones’ attorney, Roger Oliver, said he was considering advertising to see whether other Chase customers had had similar experiences.

Chase officials declined to comment on Jones’ case, but have denied his allegations and sought a dismissal of the suit in a response filed with the court. Chase asserted, among other arguments, that Jones’ problems were of his own doing; the state court lacks jurisdiction; and Jones’ grievances should be arbitrated.

Regulators also have taken notice of add-on fees, particularly in the hotel industry, which collected nearly $2 billion in such fees last year, up from $550 million in 2002, according to PricewaterhouseCoopers.

Gerald Yetman recalled that when he vacationed at the Casa Marina Resort in Key West, Fla., several years ago, a hotel staffer spritzed cool water on other guests and him as they lounged poolside. Yetman assumed that the standard room rate covered the misting.

But during checkout he noticed fees, which the desk clerk said were to cover this and other amenities. The fees totaled less than $100, Yetman said, but “the dollar amount didn’t really matter to me. It was the principle involved.”

The fees were noted in the hotel contract that Yetman had signed at check-in but were buried in the fine print, he said.

“Who, when they’re on vacation, takes the time to read all the little fine print down there?” said Yetman, of Royal Palm Beach, Fla.

After Yetman wrote to Wyndham International, which owned the resort, he was reimbursed for the fees. But his complaint came to the attention of the Florida Attorney General’s Office, which sent investigators to his home to discuss it.

It turned out that the state had launched an investigation of hotel fees in 2001 after state employees incurred similar charges at other Wyndham hotels.

In July 2006, the state settled the case for $2.3 million with LXR Luxury Resorts, a subsidiary of the Blackstone Group that purchased the Wyndham chain in 2005. The company agreed to pay restitution and for the cost of the investigation and to fully disclose automatic charges at 38 Wyndham hotels.

The probe yielded similar settlements with Marriott International and Starwood Hotels and Resorts.

The Ponemon Institute study found that consumers had a 37 percent success rate when they complained to hotels.

The success rate for complaints climbed to 60 percent for airlines and 65 percent for credit-card companies, the study found. Industries with the lowest complaint success rates include cellphone providers, at 27 percent; insurance companies, at 29 percent; and 20 percent for cable- and satellite-television providers.

Kevin Parks, of Columbus, Ohio, is experiencing that firsthand. He said that he’d expected his cable service to cost $40.95 a month, the amount that the local provider promised. When he got his first bill — for $51 — he was incensed, because the added equipment fee wasn’t mentioned or noted in the contract, he said.

After several unsuccessful complaints, Parks called on his neighbor, Carl Shoolman, for help. Shoolman, a former consumer class-action lawyer, founded ConsumerXchange.com, a Web site that handles most consumer disputes for a $43 fee.

Shoolman has sent letters on Parks’ behalf but has gotten no response from the cable company. If that continues, Shoolman said, he’ll post details of Parks’ dispute on his Web site to increase the pressure.

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