Federal Communications Commission DA 07-3581 Before the Federal Communications Commission Washington, D.C. 20554 In the Matter of Connect Paging, Inc. d/b/a Get A Phone Apparent Liability for Forfeiture ) ) ) ) ) File No. EB-06-TC-4731 NAL/Acct. No. 200732170054 FRN: 0013394028 FORFEITURE ORDER Adopted: August 10, 2007 Released: August 10, 2007 By the Enforcement Bureau: I. INTRODUCTION 1. In this Forfeiture Order (“Order”), we issue a monetary forfeiture in the amount of four thousand dollars ($4,000) against Connect Paging, Inc. d/b/a Get A Phone (“Connect” or “Company”). Connect violated a Commission order by failing to respond to the directive of the Enforcement Bureau (“Bureau”) to provide certain information and documents. Connect acted in willful or repeated violation of Section 503(b) of the Communications Act of 1934, as amended, (“Act”)1 and Section 1.80 of the Commission’s rules (“Rules”).2 2. On March 27, 2007, the Bureau issued to Connect a Notice of Apparent Liability for Forfeiture (“NAL”)3 proposing a forfeiture in the amount of four thousand dollars ($4,000) based on Connect’s apparent violation of the Bureau’s directive. The NAL gave Connect the option of paying the proposed forfeiture or of filing a response to the NAL stating why the proposed forfeiture should either not be assessed or should be reduced. The NAL was sent by certified mail to Connect’s last known address. Connect filed a response to the NAL on April 27, 2007.4 Based on the information contained therein, we affirm this forfeiture. II. BACKGROUND 3. The Bureau has been investigating the adequacy of procedures implemented by telecommunications carriers to ensure confidentiality of their subscribers’ CPNI, based on concerns regarding the apparent availability to third parties of sensitive, personal subscriber information. For 1 47 U.S.C. § 503(b). 2 47 C.F.R. § 1.80. 3 Connect Paging, Inc. d/b/a/ Get A Phone, Notice of Apparent Liability for Forfeiture, 22 FCC Rcd 6303 (2007) (“NAL”). 4 See Letter from Byron T. Young, President, Connect Paging, Inc. d/b/a Get a Phone, to Mary Greene, Deputy Division Chief, Telecommunications Consumers Division, Enforcement Bureau (April 27, 2007). Federal Communications Commission DA 07-3581 2 example, some companies, known as “data brokers,” have advertised the availability of records of wireless subscribers’ incoming and outgoing telephone calls for a fee.5 Data brokers have also advertised the availability of call information that relates to certain landline toll calls.6 4. As part of our inquiry into these issues, the Bureau sent Letters of Inquiry (“LOIs”) to several carriers, including Connect, directing them to submit their certifications for the previous five (5) years prepared in compliance with section 64.2009(e) of the Commission's rules.7 Connect did not respond to the LOI. Accordingly, on March 27, 2007, the Bureau issued the NAL to Connect for its failure to respond to the directive of the Bureau. 5. On April 27, 2007, Connect submitted several documents in response to the NAL, including a letter from its President, Byron T. Young, which explains, among other things, the Company’s reasons for failing to respond to the LOI.8 Connect states that it had no knowledge of the Bureau’s request because it was in the process of an office move.9 It states that, although an employee had apparently signed for the certified mail, the LOI was not received by any of the Company’s management.10 During 2006, it states that the Company filed for Chapter 11 Bankruptcy, and its reorganization plan was accepted in November 2006, with the final order being signed in February 2007.11 Therefore, it states, the period from mid-November 2006 through mid-January 2007 was frantic, as the Company prepared to move and worked to negotiate new contracts and leases with replacement vendors and landlords.12 Connect recognizes that not being aware of the LOI may not be sufficient reason for its non-responsiveness; however, it requests that the NAL be canceled, as a forfeiture of $4,000 would create a financial hardship for the Company.13 III. DISCUSSION 6. Section 503(b) of the Communications Act authorizes the Commission to assess a forfeiture of up to $130,000 for each violation of the Act or of any rule, regulation, or order issued by the Commission under the Act.14 The Commission may assess this penalty if it determines that the carrier’s noncompliance is “willful or repeated.”15 For a violation to be willful, it need not be intentional.16 In 5 See, e.g. http://www.epic.org/privacy/iei/. 6 See id. 7 See LOI from Marcy Greene, Deputy Division Chief, Telecommunications Division, Enforcement Bureau, to Byron Young, President, Connect Paging, Inc. d/b/a Get a Phone (December 8, 2006). 8 See supra note 4. 9 Id. 10 Id. 11 Id. 12 Id. 13 Id. 14 Section 503(b)(2)(B) provides for forfeitures against common carriers of up to $130,000 for each violation or each day of a continuing violation up to a maximum of $1,325,000 for each continuing violation. 47 U.S.C. § 503(b)(2)(B). See Amendment of Section 1.80 of the Commission’s Rules and Adjustment of Forfeiture Maxima to Reflect Inflation, 15 FCC Rcd 18221 (2000); Amendment of Section 1.80 of the Commission’s Rules and Adjustment of Forfeiture Maxima to Reflect Inflation, 19 FCC Rcd 10945 (2004) (increasing maximum forfeiture amounts to account for inflation). 15 47 U.S.C. § 503(b)(1)(B). The Commission has authority under this section of the Act to assess a forfeiture penalty against a common carrier if the Commission determines that the carrier has “willfully or repeatedly” failed to comply with the provisions of the Act or with any rule, regulation, or order issued by the Commission under the (continued....) Federal Communications Commission DA 07-3581 3 exercising our forfeiture authority, we are required to take into account “the nature, circumstances, extent, and gravity of the violation and, with respect to the violator, the degree of culpability, any history of prior offenses, ability to pay, and such other matters as justice may require.”17 In addition, the Commission has established guidelines for forfeiture amounts and, where there is no specific base amount for a violation, retained discretion to set an amount on a case-by-case basis.18 7. The Commission’s forfeiture guidelines do not address the specific violation at issue in this proceeding. In determining the proper forfeiture amount in this case, however, we are guided by the principle that there may be no more important obligation on a carrier’s part than protection of its subscribers’ proprietary information. Consumers are increasingly concerned about the security of their sensitive, personal data that they must entrust to their various service providers, whether they are financial institutions or telephone companies. Given the increasing concern about the security of this data, and evidence that the data appears to be widely available to third parties, we must take aggressive, substantial steps to ensure that carriers implement necessary and adequate measures to protect their subscribers’ CPNI as required by the Commission’s existing CPNI rules. 8. In this case, Connect states that it had no knowledge of the Bureau’s LOI due to the frantic state of affairs created by its Chapter 11 Bankruptcy filing and pending move. As the Company acknowledges, however, the lack of knowledge by its management is not sufficient reason for failing to respond to the Bureau’s directive, especially considering that the certified mail was signed for by a company employee. Additionally, the Company has not provided adequate justification to merit a reduction of the forfeiture amount. After fully considering the facts and circumstances described herein, we believe the forfeiture of $4,000 is warranted in this case. 19 9. Accordingly, IT IS ORDERED THAT, pursuant to Section 503(b) of the Act,20 and Sections 0.111, 0.311 and 180(f)(4) of the Rules,21 Connect Paging, Inc. d/b/a Get A Phone IS LIABLE FOR A MONETARY FORFEITURE in the amount of four thousand dollars ($4,000) for willfully and repeatedly violating Section 503 of the Act and Section 1.80 of the Rules within thirty (30) days of the release of this Order. If the forfeiture is not paid within the period specified, the case may be referred to the Department of Justice for collection pursuant to Section 504(a) of the Act.22 10. Payment of the forfeiture must be made by check or similar instrument, payable to the order of the Federal Communication Commission. The payment must include the NAL/Acct. No. and FRN No. referenced above. Payment by check or money order may be mailed to Forfeiture Collection Section, Finance Branch, Federal Communications Commission, P.O. Box 358340, Pittsburgh, (...continued from previous page) Act. The section provides that the Commission must assess such penalties through the use of a written notice of apparent liability or notice of opportunity for hearing. See 47 U.S.C. § 503(b)(4)(A). Here, as described above, AT&T’s actions were willful as it apparently failed to prepare the required compliance certification. 16 Southern California Broadcasting Co., 6 FCC Rcd 4387 (1991). 17 See 47 U.S.C. § 503(b)(2)(D); see also The Commission’s Forfeiture Policy Statement and Amendment of Section 1.80 of the Commission’s Rules, 12 FCC Rcd 17087 (1997) (“Forfeiture Policy Statement”); recon. denied, 15 FCC Rcd 303 (1999). 18 Forfeiture Policy Statement, 12 FCC Rcd 17098-99, ¶ 22. 19 47 U.S.C. § 503(b)(4)(A). 20 47 U.S.C. § 503(b). 21 47 C.F.R. §§ 0.111, 0.311, 1.80(f)(4). 22 47 U.S.C. § 504(a). Federal Communications Commission DA 07-3581 4 Pennsylvania 15251. Payment by overnight mail may be sent to Mellon Client Service Center, 500 Ross Street, Room 670, Pittsburgh, PA 15262-0001, Attn.: FCC Module Supervisor. Payment by wire transfer may be made to: ABA Number 043000261, receiving bank Mellon Bank, and account number 911-6229. Please include your NAL/Acct. No. with your wire transfer remittance. Requests for full payment under an installment plan should be sent to: Chief, Revenue and Receivables Operations Group, 445 12th Street, S.W., Washington, D.C. 20554. 5. IT IS FURTHER ORDERED that a copy of the Forfeiture Order shall be sent by first class mail and certified mail return requested to Connect Paging, Inc. d/b/a Get A Phone at its last known address, 112 E. Seminary Drive, Suite B, Fort Worth, Texas 76115. FEDERAL COMMUNICATIONS COMMISSION Kris A. Monteith Chief, Enforcement Bureau