DISSENTING STATEMENT OF
COMMISSIONER MICHAEL O’RIELLY
Re: Preferred Long Distance, File No. EB-TCD-12-00003409
Today the Commission adds another layer to its dubious wall of precedent that uses section 201 
as an independent basis to regulate conduct that is already covered by a specific provision of the Act.  Not 
surprisingly, these additions are often done through enforcement actions, which are less likely to be 
challenged by the target.  Moreover, by proceeding in this manner, the Commission is counting on the 
fact that most companies will not even be aware that this wall is being constructed until they run into it.  
By that time, the Commission will have a string of citations ready to deploy to “prove” that section 201 
covers whatever conduct is disfavored at that time.
In this particular Forfeiture Order, the Commission penalizes a company for slamming, which is 
changing a person’s long distance carrier without the person’s authorization.  Congress generally 
prohibited that conduct in section 258 and directed the Commission to adopt rules for verifying that 
carrier changes are authorized.  To be sure, this item briefly concludes that the company did not follow 
those rules, but I disagree with that assessment.  
The recordings of the Third Party Verification (TPV) process show that the verifications were not 
rushed and quite clear.  Subscribers are told that they could speak up at any time if anything they are 
hearing is incorrect or does not match what Preferred Long Distance’s representative previously stated.  
And the verifier pauses between each step to elicit a clear response.  In several cases, the subscribers do 
speak up to correct a name or to ask for something to be repeated.  
Critically, while the exact wording varies slightly each time, the verifiers plainly state that 
Preferred Long Distance is not affiliated with the local telephone company and is separate from and/or 
competes with the local telephone company.  This information is repeated again during the callback to 
complete the verification.  Moreover, where only long distance service is being changed, the verifiers take 
care to note that while long distance charges will be added to the local provider’s bill, the two companies 
are not related.  
The only conceivable flaw is that section 64.1120(c)(3)(iii) requires the verifier to elicit the 
telephone numbers to be switched.  Here the verifiers confirm, several times, that the telephone numbers 
to be transferred are the numbers or lines “associated with your business”.  The subscribers do not state 
the actual digits, but it is not clear that is required by the rule.  Since it seems clear that the subscribers 
knew which lines were being transferred, I do not find this to be a violation.  
Most of the analysis, and the resulting fine, however, is attributable to supposed violations of 
section 201.  There is no good reason for that.  If a company violated section 258, which was not the case 
here, then it should be fined as appropriate under that section.  Layering on further penalties, as if that 
somehow makes a company extra guilty, or to achieve a bigger penalty, should not be the goal.  Rather, 
the purpose of enforcement is to achieve compliance with the rules, and that can be done without this 
surplusage.  
It would seem to me that if a company misrepresents itself, then the change is not properly 
authorized.  Moreover, the purpose of adopting the detailed TPV requirements was to correct any 
misrepresentations that may have been made by a provider or its telemarketer.  But if some are concerned 
that misrepresentations made during the course of a slam are somehow not covered by the Commission’s 
slamming rules, or that the TPV process is not performing as intended, then the Commission has the 
authority to do that through a rulemaking proceeding.  There is no need to invoke section 201’s 
prohibitions on unjust and unreasonable practices to boot.  
Indeed, invoking section 201 directly causes more problems for the Commission because it has to 
defend, rather weakly, why it has no rules.  And it has had to do this time and time again.  It seems like it 
would be less of burden to simply conduct a rulemaking to put in place whatever regulations the 
Commission thinks may be necessary.  
But, of course, that is not actually the point of this exercise.  The Commission simply wants to 
preserve its right to use section 201 at any time and for any reason.  Today it is supposed 
misrepresentation associated with slamming.  Tomorrow it could be alleged misrepresentation connected 
with terms and conditions or privacy and security.  I object to this charade and I must dissent.