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Federal Communications Commission
1919 - M Street, N.W.
Washington, D.C. 20554
News media information 202 / 418-0500
Fax-On-Demand 202 / 418-2830
Internet: http://www.fcc.gov

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. Circ 1974).

Report No. CC 97-36 COMMON CARRIER ACTION July 15, 1997

FCC Proposes Further Action to Prevent Slamming
(CC Docket No. 94-129)

The Commission has asked for comment on further ways to eliminate slamming, the practice of changing a consumer's telephone service provider without his or her knowledge or consent. In a Notice of Proposed Rulemaking to be released today, the Commission seeks comment on whether the current procedures used to verify long distance carrier changes should be strengthened; whether unauthorized carriers should be liable for any premiums, such as frequent flier miles, that "slammed" consumers would have received from their authorized carriers; and whether "slammed" consumers should be liable for any unpaid charges assessed by unauthorized carriers. The Commission receives more complaints about slamming than any other telephone-related topic, more than 16,000 in 1996 alone. Over the past two years it has taken enforcement action against 15 companies for slamming violations, assessing more than $1 million in forfeitures and consent decrees, with approximately $500,000 in additional penalties pending.

The Telecommunications Act of 1996 substantially bolstered the Commission's efforts to eliminate slamming. The 1996 Act expanded the scope of the Commission's authority to address all telecommunications carriers, including local carriers. In addition, the Act added an economic disincentive for carriers to slam because it requires an unauthorized carrier that violates the Commission's change verification procedures to pay the charges it collects from a slammed consumer to the consumer's properly authorized carrier. The Commission said that its verification procedures, coupled with this economic disincentive and the rules proposed today, provide a two-pronged approach to deter slamming.

The Commission's current verification procedures require long distance carriers to use one of four methods to confirm long distance carrier change orders generated by telemarketing. The Commission has proposed to apply these rules with equal force to any telecommunications carrier. The Commission also seeks comment on the volume of consumer-initiated calls, or so-called "in-bound" calls, received by carriers for changes in carrier selection, the per-consumer costs for verifying such calls, and its tentative conclusion that the verification rules should apply to these calls as well as to carrier-initiated calls, or so-called "out-bound" calls. In addition, the Commission seeks comment on whether the verification rules should apply when a carrier solicits a consumer regarding a preferred carrier freeze, which blocks future carrier changes unless the consumer gives his or her written or oral consent to the blocking carrier.

Finally, the Commission asked for comment on a number of other issues related to slamming. For example, comments are requested concerning: (1) whether a type of "welcome package" mailed to a consumer's home may continue to serve as a carrier change verification method; (2) whether, in the event of disputes, the unauthorized and the authorized carrier must pursue private negotiations related to the transfer of charges and lost premiums prior to petitioning the FCC to make a determination; (3) how to determine liability between carriers that submit and carriers that execute an unauthorized carrier change; and (4) when a resale carrier must notify a consumer that the underlying network provider is changed.

Informal comments on the Notice of Proposed Rulemaking may be sent to "slamming@comments.fcc.gov".

Action by the Commission July 14, 1997, by Further Notice of Proposed Rulemaking and Memorandum Opinion and Order on Reconsideration (FCC 97-248). Chairman Hundt, Commissioners Quello, Ness, and Chong.


News media contact: Rochelle Cohen at (202) 418-0253.
Common Carrier Bureau contact: Diane Harmon (202) 418-7294 or
Cathy Seidel (202) 418-1699.