*Pages 1--6 from Microsoft Word - 42187* Federal Communications Commission DA 04- 2927 Before the Federal Communications Commission Washington, D. C. 20554 In the Matter of UKI Communications Complaints Regarding Unauthorized Change of Subscriber’s Telecommunications Carrier ) ) ) ) ) ) ) IC Nos. 03- S83336 03- S85060 03- S85185 03- S85269 03- S85355 03- S85482 03- S85555 03- S85556 03- S85629 03- S85707 03- S85715 03- S85846 03- S85780 03- S85827 03- I0067917S 03- I0070931S 03- I0075228S 03- I0075668S 03- I0078910S 03- S000331S 04- S85912 04- S86203 04- S86480 04- S86486 04- S87078 04- S87058 ORDER Adopted: September 9, 2004 Released: September 13, 2004 By the Deputy Chief, Consumer Policy Division, Consumer & Governmental Affairs Bureau 1. In this Order, we consider complaints 1 alleging that UKI Communications, Inc. (UKI) changed Complainants’ telecommunications service providers without obtaining authorization and verification from Complainants in violation of the Commission’s rules. 2 We 1 See Appendix A. 2 See 47 C. F. R. §§ 64. 1100 – 64. 1190. 1 Federal Communications Commission DA 04- 2927 2 conclude that UKI’s actions did result in an unauthorized change in Complainants’ telecommunications service providers and we grant Complainants’ complaints. 2. In December 1998, the Commission released the Section 258 Order in which it adopted rules to implement section 258 of the Communications Act of 1934 (Act), as amended by the Telecommunications Act of 1996 (1996 Act). 3 Section 258 prohibits the practice of “slamming,” the submission or execution of an unauthorized change in a subscriber’s selection of a provider of telephone exchange service or telephone toll service. 4 In the Section 258 Order, the Commission adopted aggressive new rules designed to take the profit out of slamming, broadened the scope of the slamming rules to encompass all carriers, and modified its existing requirements for the authorization and verification of preferred carrier changes. The rules require, among other things, that a carrier receive individual subscriber consent before a carrier change may occur. 5 Pursuant to section 258, carriers are absolutely barred from changing a customer's preferred local or long distance carrier without first complying with one of the Commission's verification procedures. 6 Specifically, a carrier must: (1) obtain the subscriber's written or electronically signed authorization in a format that meets the requirements of section 64.1130 authorization; (2) obtain confirmation from the subscriber via a toll- free number provided exclusively for the purpose of confirming orders electronically; or (3) utilize an independent third party to verify the subscriber's order. 7 3. The Commission also has adopted liability rules. These rules require the carrier to absolve the subscriber where the subscriber has not paid his or her bill. In that context, if the subscriber has not already paid charges to the unauthorized carrier, the subscriber is absolved of liability for charges imposed by the unauthorized carrier for service provided during the first 30 3 47 U. S. C. § 258( a); Telecommunications Act of 1996, Pub. L. No. 104- 104, 110 Stat. 56 (1996); Implementation of the Subscriber Carrier Selection Changes Provisions of the Telecommunications Act of 1996; Policies and Rules Concerning Unauthorized Changes of Consumers’ Long Distance Carriers, CC Docket No. 94- 129, Second Report and Order and Further Notice of Proposed Rule Making, 14 FCC Rcd 1508 (1998) (Section 258 Order), stayed in part, MCI WorldCom v. FCC, No. 99- 1125 (D. C. Cir. May 18, 1999); First Order on Reconsideration, 15 FCC Rcd 8158 (2000); stay lifted, MCI WorldCom v. FCC, No. 99- 1125 (D. C. Cir. June 27, 2000); Third Report and Order and Second Order on Reconsideration, 15 FCC Rcd 15996 (2000), Errata, DA No. 00- 2163 (rel. Sept. 25, 2000), Erratum, DA No. 00- 2192 (rel. Oct. 4, 2000), Order, FCC 01- 67 (rel. Feb. 22, 2001); Third Order on Reconsideration and Second Further Notice of Proposed Rule Making, 18 FCC Rcd 5099 (2003); Order, FCC 03- 116, (rel. May 23, 2003). Prior to the adoption of Section 258, the Commission had taken various steps to address the slamming problem. See, e. g., Policies and Rules Concerning Unauthorized Changes of Consumers' Long Distance Carriers, CC Docket No. 94- 129, Report and Order, 10 FCC Rcd 9560 (1995), stayed in part, 11 FCC Rcd 856 (1995); Policies and Rules Concerning Changing Long Distance Carriers, CC Docket No. 91- 64, 7 FCC Rcd 1038 (1992), reconsideration denied, 8 FCC Rcd 3215 (1993); Investigation of Access and Divestiture Related Tariffs, CC Docket No. 83- 1145, Phase I, 101 F. C. C. 2d 911, 101 F. C. C. 2d 935, reconsideration denied, 102 F. C. C. 2d 503 (1985). 4 47 U. S. C. § 258( a). 5 See 47 C. F. R. § 64. 1120. 6 47 U. S. C. § 258( a). 7 See 47 C. F. R. § 64. 1120( c). Section 64. 1130 details the requirements for letter of agency form and content for written or electronically signed authorizations. 47 C. F. R. § 64. 1130. 2 Federal Communications Commission DA 04- 2927 3 days after the unauthorized change. 8 Where the subscriber has paid charges to the unauthorized carrier, the Commission’s rules require that the unauthorized carrier pay 150% of those charges to the authorized carrier, and the authorized carrier shall refund or credit to the subscriber 50% of all charges paid by the subscriber to the unauthorized carrier. 9 Carriers should note that our actions in this order do not preclude the Commission from taking additional action, if warranted, pursuant to Section 503 of the Act. 10 4. We received Complainants’ complaints alleging that Complainants’ telecommunications service providers had been changed from their authorized carriers to UKI without Complainants’ authorization. 11 Pursuant to sections 1.719 and 64.1150 of our rules, 12 we we notified UKI of the complaints and UKI did not file respond. We find that UKI has failed to provide clear and convincing evidence of a valid authorized carrier changes by Complainants. Therefore, we find that UKI’s actions resulted in unauthorized changes in Complainants’ telecommunications service providers and we discuss UKI’s liability below. 13 5. UKI must remove all charges incurred for service provided to Complainants for the first thirty days after the alleged unauthorized change in accordance with the Commission’s liability rules. 14 We have determined that Complainants are entitled to absolution for the charges incurred during the first thirty days after the unauthorized change occurred and that neither the Complainants’ authorized carrier nor UKI may pursue any collection against Complainants for those charges. 15 Any charges imposed by UKI on the subscribers for service provided after this 30- day period shall be paid by the subscribers to the Complainants’ respective authorized carrier at the rate the subscribers were paying to the respective authorized carrier at the time of the change in service. 16 6. Accordingly, IT IS ORDERED that, pursuant to section 258 of the 8 See 47 C. F. R. §§ 64. 1140, 64. 1160. Any charges imposed by the unauthorized carrier on the subscriber for service provided after this 30- day period shall be paid by the subscriber to the authorized carrier at the rates the subscriber was paying to the authorized carrier at the time of the unauthorized change. Id. 9 See 47 C. F. R. §§ 64. 1140, 64.1170. 10 See 47 U. S. C. § 503. 11 See Appendix A. 12 47 C. F. R. § 1.719 (Commission procedure for informal complaints filed pursuant to section 258 of the Act); 47 C. F. R. § 64. 1150 (procedures for resolution of unauthorized changes in preferred carrier). 13 If any Complainant is unsatisfied with the resolution of this complaint, such Complainant may file a formal complaint with the Commission pursuant to section 1.721 of the Commission’s rules, 47 C. F. R. § 1. 721. Such filing will be deemed to relate back to the filing date of such Complainant’s informal complaint so long as the formal complaint is filed within 45 days from the date this order is mailed or delivered electronically to such Complainant. See 47 C. F. R. § 1. 719. 14 See 47 C. F. R. § 64. 1160( b). 15 See 47 C. F. R. § 64. 1160( d). 16 See 47 C. F. R. §§ 64. 1140, 64.1160. 3 Federal Communications Commission DA 04- 2927 4 Communications Act of 1934, as amended, 47 U. S. C. § 258, and sections 0.141, 0.361 and 1.719 of the Commission’s rules, 47 C. F. R. §§ 0.141, 0.361, 1.719, the complaints filed against UKI ARE GRANTED. 7. IT IS FURTHER ORDERED that, pursuant to section 64.1170( d) of the Commission’s rules, 47 C. F. R. § 64.1170( d), Complainants are entitled to absolution for the charges incurred during the first thirty days after the unauthorized change occurred and neither the authorized carriers nor UKI may pursue any collection against Complainants for those charges. 8. IT IS FURTHER ORDERED that this Order is effective upon release. FEDERAL COMMUNICATIONS COMMISSION Nancy A. Stevenson, Deputy Chief Consumer Policy Division Consumer & Governmental Affairs Bureau 4 Federal Communications Commission DA 04- 2927 5 APPENDIX A INFORMAL DATE OF AUTHORIZED COMPLAINT COMPLAINT CARRIER NUMBER 03- S83336 03/ 12/ 03 AT& T 03- S85060 09/ 22/ 03 Worldcom 03- S85185 12/ 10/ 03 AT& T 03- S85269 09/ 05/ 03 AT& T 03- S85355 10/ 22/ 03 Sprint 03- S85482 10/ 23/ 03 Worldcom 03- S85555 11/ 06/ 03 IDT 03- S85556 11/ 13/ 03 Southwestern Bell 03- S85629 11/ 20/ 03 Sprint 03- S85707 11/ 13/ 03 Verizon 03- S85715 11/ 13/ 03 AT& T 03- S85846 12/ 19/ 03 Verizon 03- S85780 11/ 03/ 03 CloseCall America 03- S85827 12/ 16/ 03 Verizon 03- I0067917S 10/ 07/ 03 AT& T 03- I0070931S 11/ 04/ 03 Southwestern Bell 03- I0075228S 12/ 16/ 03 Verizon 03- I0075668S 11/ 12/ 03 Verizon 03- I0078910S 12/ 08/ 03 Verizon 03- S000331S 10/ 20/ 03 Worldcom 5 Federal Communications Commission DA 04- 2927 6 APPENDIX A INFORMAL DATE OF AUTHORIZED COMPLAINT COMPLAINT CARRIER NUMBER 04- S85912 12/ 19/ 03 Verizon 04- S86203 02/ 04/ 04 Worldcom 04- S86480 01/ 28/ 04 Verizon 04- S86486 02/ 10/ 04 AT& T 04- S87078 03/ 15/ 04 Verizon 04- S87058 03/ 30/ 04 Southwestern Bell 6