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Selectel, Inc. Slamming Order

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Released: March 28, 2013

Federal Communications Commission

DA 13-561

Before the

Federal Communications Commission

Washington, D.C. 20554

In the Matter of
)
)

Selectel, Inc.
)
IC Nos. 11-S003244
)
11-S3000761
Complaints Regarding
)
11-S3048310
Unauthorized Change of
)
11-S3287246
Subscriber’s Telecommunications Carrier
)
11-S3283501
)
11-S3291325
)
12-S3491352


ORDER

Adopted: March 26, 2013

Released: March 28, 2013

By the Deputy Chief, Consumer Policy Division, Consumer & Governmental Affairs Bureau:
1.
In this Order, we consider the complaints1 alleging that Selectel, Inc. (Selectel)
changed Complainants’ telecommunications service providers without obtaining authorization
and verification from Complainants in violation of the Commission’s rules.2 We conclude that
Selectel’s actions did result in unauthorized changes 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


1
See Appendix.
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 13-561

“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; (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
4.
We received Complainants’ complaints alleging that Complainants’
telecommunications service providers had been changed without Complainants’ authorization.11





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
See Appendix.
2

Federal Communications Commission

DA 13-561

Pursuant to Sections 1.719 and 64.1150 of our rules,12 we notified Selectel of the complaints and
Selectel responded.13 Selectel states that authorization was received and confirmed through third
party verification (TPV) in each case. The Commission’s rules require that the verification elicit,
amongst other things, confirmation that the person on the call is “authorized to make the carrier
change.” 14 We have reviewed the TPVs that Selectel submitted with its responses. In each case,
the verifier instead states to the person on the call, “To confirm that you are over 18 and the
decision maker for these telephone numbers, at the tone, please say yes and then press the pound
key.” A switch from one carrier to another carrier differs from merely making changes to the
customer’s service; in these cases, the verifier has not elicited confirmation that the person is
authorized to make a carrier change.15 As we emphasized in the Fourth Report and Order, “any
description of the carrier change transaction…must not be misleading” and verifiers should
convey explicitly that “the consumers will have authorized a carrier change, and not for instance
an upgrade in existing service.”16 We find that Selectel’s actions were in violation of our carrier
change rules, and we discuss Selectel’s liability below.17
5.
Selectel must remove all charges incurred for service provided to Complainants
for the first thirty days after the alleged unauthorized changes in accordance with the
Commission’s liability rules.18 We have determined that Complainants are entitled to absolution
for the charges incurred during the first thirty days after the unauthorized changes occurred and
that neither the Complainants’ authorized carrier nor Selectel may pursue any collection against
Complainants for those charges.19 Any charges imposed by Selectel on the subscribers for
service provided after this 30-day period shall be paid by the subscribers to their authorized
carrier at the rates the subscribers were paying to their authorized carriers at the time of the
unauthorized changes of telecommunications service providers.20


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
See Appendix.
14
See 47 C.F. R. § 64.1120(c)(3)(iii).
15
Cf. Consumer Telcom, Inc., Order on Reconsideration, 27 FCC Rcd 5340 (CGB 2012) (“the
verifier’s question, ‘Do you have authority to make changes to your long distance service?’ did not confirm that
the person was authorizing a change that would result in receiving service from a different carrier”).
16
See Fourth Report and Order, 23 FCC Rcd 493 (2008)(emphasis added); see also 47 C.F.R.
§ 64.1120(c)(3)(iii).
17
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.
18
See 47 C.F.R. § 64.1160(b).
19
See 47 C.F.R. § 64.1160(d).
20
See 47 C.F.R. §§ 64.1140, 64.1160.
3

Federal Communications Commission

DA 13-561

6.
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 complaints filed against
Selectel Communications, Inc., 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 Selectel nor the authorized carriers 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 13-561

APPENDIX
INFORMAL
DATE OF

DATE OF
COMPLAINT

COMPLAINT

RESPONSE
NUMBER
11-S003244
October 24, 2011
February 1, 2012
11-S3000761
February 28, 2011
May 26, 2011
11-S3048310
March 7, 2011
June 2, 2011
11-S3283501
November 28, 2011
February 28, 2012
11-S3287246
December 5, 2011
March 1, 2012
11-S3291325
December 9, 2011
March 1, 2012
12-S3491352
October 3, 2012
November 9, 2012
5

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