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FCC to Fine Optic $7.62M for Cramming, Slamming, and False Recordings

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Released: July 14, 2014
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NEWS

Federal Communications Commission

News Media Information 202 / 418-0500

445 12th Street, S.W.

Internet: http://www.fcc.gov

Washington, D.C. 20554

This is an unofficial announcement of Commission action. Release of the full text of a Commission order constitutes official action.

See MCI v. FCC. 515 F 2d 385 (D.C. Cir. 1974).

FOR IMMEDIATE RELEASE:

NEWS MEDIA CONTACT:

July 14, 2014

Mark Wigfield, 202-418-0253

E-mail: mark.wigfield@fcc.gov

FCC PLANS $7.62 MILLION FINE AGAINST OPTIC INTERNET PROTOCOL FOR ILLEGALLY

BILLING AND SWITCHING CUSTOMERS’ PHONE COMPANIES

Long Distance Carrier Allegedly Relied On Fabricated “Authorization” Recordings

Washington, DC – The Federal Communications Commission plans to fine Optic Internet Protocol, Inc., a

Roswell, GA telephone company, $7.62 million for allegedly switching consumers’ long distance telephone

services without their authorization (“slamming”), billing customers for unauthorized charges (“cramming”),

and submitting falsified evidence to government regulatory officials as “proof” of consumers’ authorizations.

“Cheating and lying to consumers are unacceptable, predatory business practices,” said Travis LeBlanc,

Acting Chief of the Enforcement Bureau. “We will vigorously police companies that deceive consumers by

billing them for services they did not authorize or desire.”

Optic provides 1+ dialing long distance service. For a consumer to use Optic’s service, the consumer’s long

distance service provider must be switched to Optic so that long distance calls are carried over Optic’s

network and billed to Optic. Optic allegedly switched complainants’ preferred long distance carriers and also

billed the consumers for long distance service by placing charges for its set-up fee and recurring monthly fee

on their local telephone bills. Optic typically charged customers a $3.95 or $4.95 one-time set up fee as well

as a monthly service fee of $4.95, $8.95, or $29.95.

The Enforcement Bureau reviewed more than 150 complaints against Optic that consumers filed with the

Commission, the Federal Trade Commission, state regulatory agencies, and the Better Business Bureau.

Affected consumers complained that they had never heard of Optic before discovering the company’s charges

on their telephone bills. Several claimed that when they contacted Optic to dispute the charges, they were

told that they or someone in their household had authorized Optic’s service, and that Optic possessed an audio

recording as evidence of the authorization. Optic submitted these audio “verification” recordings to the

Commission, consumers, and state regulatory authorities to make it appear that consumers had authorized the

company’s services, but consumers who listened to these recordings informed the Enforcement Bureau that

the recordings were fabricated and adamantly denied that the voices on the recordings were their own. As a

result, consumers who noticed the unauthorized charges had to expend significant time and effort to attempt

to return to their preferred carriers, to get the charges removed from their bills, and file complaints with law

enforcement agencies.

The Commission charged Optic with willfully and repeatedly placing unauthorized charges on consumers’

local telephone bills, switching consumers’ preferred long distance carrier without verified authorization, and

submitting fabricated audio “verification” recordings, all in apparent violation of the Communications Act.

The Commission is committed to protecting consumers against cramming and slamming and will take

aggressive action against carriers that perpetrate such unjust, unreasonable, and deceptive acts. Since January

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2014, the FCC has taken four enforcement actions against carriers for cramming and slamming that have

totaled more than $17 million in proposed penalties and payments to the U.S. Treasury.

For more information about the FCC’s rules protecting consumers from unauthorized charges on phone bills,

see the FCC consumer guide, Cramming - Unauthorized, Misleading, or Deceptive Charges Placed on Your

Telephone Bill. For information about other communications issues, visit the FCC's Consumer website, or

contact the FCC's Consumer Center by calling 1-888-CALL-FCC (1-888-225-5322) voice or 1-888-TELL-

FCC (1-888-835-5322) TTY; faxing 1-866-418-0232; or by writing to:

Federal Communications Commission

Consumer and Governmental Affairs Bureau

Consumer Inquiries and Complaints Division

445 12th Street, SW

Washington, DC 20554

The Notice of Apparent Liability is available at:

http://hraunfoss.fcc.gov/edocs_public/attachmatch/FCC-14-

101A1.pdf

-FCC-

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