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Integrated Services, Inc

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Released: February 26, 2010

Federal Communications Commission

DA 10-329

Before the

Federal Communications Commission

Washington, D.C. 20554

In the Matter of
)
)

Integrated Services, Inc
)
IC No. 09-S0296578
)
Complaint Regarding
)
Unauthorized Change of
)
Subscriber’s Telecommunications Carrier
)
)

ORDER

Adopted: February 25, 2010

Released: February 26, 2010

By the Deputy Chief, Consumer Policy Division, Consumer & Governmental Affairs Bureau:
1.
In this Order, we consider the complaint1 alleging that Integrated Services, Inc.
(ISI) changed Complainant’s telecommunications service provider without obtaining
authorization and verification from Complainant in violation of the Commission’s rules.2 We
conclude that ISI’s actions did result in an unauthorized change in Complainant’s
telecommunications service provider and we grant Complainant’s complaint.
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


1
Informal Complaint No. IC 09-S0296578, filed August 3, 2009.
2
See 47 C.F.R. §§ 64.1100 – 64.1190.
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, 18 FCC Rcd 10997 (2003). Fourth Report and Order, 23 FCC Rcd 493 (2008). 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 Carrier
s, 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).

Federal Communications Commission

DA 10-329

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; (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
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
We received Complainant’s complaint on August 3, 2009, alleging that Complainant’s
telecommunications service provider had been changed to ISI without Complainant’s
authorization. Pursuant to Sections 1.719 and 64.1150 of our rules,11 we notified ISI of the
complaint and ISI responded on August 25, 2009.12 ISI states that authorization was received


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.
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
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).
12
ISI’s Response to Informal Complaint No. IC 09-S0296578, received August 25, 2009.
2

Federal Communications Commission

DA 10-329

and confirmed through third party verification. We have reviewed the TPV ISI filed with its
response, ISI’s verifier stated that the purpose of the recorded conversation was to “verify and
confirm your account information.” However, the purpose of the TPV recording is to verify a
subscriber’s intent to change their preferred carrier. As we emphasized in the Fourth Report and
Order, “any description of the carrier change transaction…shall not be misleading.”13
We find that ISI has failed to produce clear and convincing evidence that Complainant
authorized a carrier change.14 Therefore, we find that ISI’s actions resulted in an unauthorized
change in Complainant’s telecommunications service provider and we discuss ISI’s liability
below.15
4.
ISI must remove all charges incurred for service provided to Complainant for the
first thirty days after the alleged unauthorized change in accordance with the Commission’s
liability rules.16 We have determined that Complainant is entitled to absolution for the charges
incurred during the first thirty days after the unauthorized change occurred and that neither
Complainant’s authorized carrier nor ISI may pursue any collection against Complainant for
those charges.17 Any charges imposed by ISI on the subscriber for service provided after this 30-
day period shall be paid by the subscriber to their authorized carrier at the rates the subscriber
was paying to their authorized carrier at the time of the unauthorized change.18
5.
Accordingly, IT IS ORDERED that, pursuant to Section 258 of the
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 complaint filed against
ISI IS GRANTED.
6.
IT IS FURTHER ORDERED that, pursuant to Section 64.1170(d) of the
Commission’s rules, 47 C.F.R. § 64.1170(d), Complainant is entitled to absolution for the
charges incurred during the first thirty days after the unauthorized change occurred and neither
Complainant’s authorized carrier nor ISI may pursue any collection against Complainant for
those charges.


13
Fourth Report and Order, 23 FCC Rcd 493 (2008).
14
See 47 C.F.R. § 64.1150(d).
15
If Complainant is unsatisfied with the resolution of this complaint, 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 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
Complainant. See 47 C.F.R. § 1.719.
16
See 47 C.F.R. § 64.1160(b).
17
See 47 C.F.R. § 64.1160(d).
18
See 47 C.F.R. §§ 64.1140, 64.1160.
3

Federal Communications Commission

DA 10-329

7.
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

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