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                           Before the
                Federal Communications Commission
                     Washington, D.C. 20554




In the Matter of                 )
                                )
AT&T Inc.                        )
                                )    File No. EB-06-TC-059
                                )
Apparent Liability for           )    NAL/Acct. No. 200632170003
Forfeiture                       )    FRN: 0004305124
                                )
                                )


           NOTICE OF APPARENT LIABILITY FOR FORFEITURE

Adopted: January 30, 2006               Released: January 30, 
2006

By the Chief, Enforcement Bureau:

I.   INTRODUCTION

     1.In this Notice of Apparent Liability for Forfeiture 
(``NAL''), we find that AT&T Inc. (``AT&T'') apparently violated 
section 64.2009(e) of the Commission's rules1 by failing to have 
a corporate officer with personal knowledge execute an annual 
certificate stating that the company has established operating 
procedures adequate to ensure compliance with the Commission's 
rules governing protection and use of Customer Proprietary 
Network Information (``CPNI'').  Protection of CPNI is a 
fundamental obligation of all telecommunications carriers as 
provided by section 222 of the Communications Act of 1934, as 
amended (``Communications Act'' or ``Act'').  Based upon our 
review of the facts and circumstances surrounding this apparent 
violation, and in particular the serious consequences that may 
flow from inadequate concern for and protection of CPNI, we 
propose a monetary forfeiture of $100,000 against AT&T for its 
apparent failure to comply with section 64.2009(e) of the 
Commission's rules.  

II.       BACKGROUND

     2.The Enforcement Bureau (``Bureau'') has been 
investigating the adequacy of procedures implemented by 
telecommunications carriers to ensure confidentiality of their 
subscribers' CPNI, based on concerns regarding the apparent 
availability to third parties of sensitive, personal subscriber 
information.  For example, some companies, known as ``data 
brokers,'' have advertised the availability of records of 
wireless subscribers' incoming and outgoing telephone calls for a 
fee.2  Data brokers have also advertised the availability of 
certain landline toll calls.3  

     3.As part of our inquiry into these issues, the Bureau 
directed several carriers, including AT&T, to submit their most 
recent certification prepared in compliance with section 
64.2009(e) of the Commission's rules.  On January 27, 2006, AT&T 
submitted documents constituting certifications by the SBC 
Communications, Inc. (SBC) companies.  AT&T, however, did not 
provide any annual certification prepared by the former AT&T 
Corp.  Accordingly, it appears that AT&T has not prepared and 
maintained a certification in compliance with section 64.2009(e) 
of the Commission's rules.  Therefore, we issue this proposed 
forfeiture.  

III.       DISCUSSION

     4.   Section 222 imposes the general duty on all 
telecommunications carriers to protect the confidentiality of 
their subscribers' proprietary information.4  The Commission has 
issued rules implementing section 222 of the Act.5  The 
Commission required carriers to establish and maintain a system 
designed to ensure that carriers adequately protected their 
subscribers' CPNI.  Section 64.2009(e) is one such requirement.  
Pursuant to section 64.2009(e):

          A telecommunications carrier must have an officer, 
          as an agent of the carrier, sign a compliance 
          certificate on an annual basis stating that the 
          officer has personal knowledge that the company 
          has established operating procedures that are 
          adequate to ensure compliance with the rules in 
          this subpart.  The carrier must provide a 
          statement accompanying the certificate explaining 
          how its operating procedures ensure that it is or 
          is not in compliance with the rules in this 
          subpart.6

     5.   On January 25, 2006, the Bureau directed AT&T, among 
other companies, to produce the most recent compliance 
certificate that it had prepared in compliance with section 
64.2009(e) of the Commission's rules.7  In light of their recent 
merger, and to review the compliance by both, the Bureau asked 
for the most recent certification prepared for SBC as well as the 
most recent certification prepared by AT&T Corp.  On January 27, 
2006, AT&T provided documents constituting the most recent 
certifications prepared for SBC.  AT&T, however, did not produce 
a certification for AT&T Corp.  AT&T could not demonstrate that 
it had in its possession a certification that AT&T Corp. had 
prepared in compliance with section 64.2009(e) of the 
Commission's rules.

     6.   We conclude that AT&T has apparently failed to comply 
with the requirement that it have an officer certify on an annual 
basis that the officer has personal knowledge that AT&T has 
established operating procedures adequate to ensure compliance 
with the Commission's CPNI rules.  For this apparent violation, 
we propose a forfeiture.

IV.  FORFEITURE AMOUNT

     7.   Section 503(b) of the Communications Act authorizes the 
Commission to assess a forfeiture of up to $130,000 for each 
violation of the Act or of any rule, regulation, or order issued 
by the Commission under the Act.8  The Commission may assess this 
penalty if it determines that the carrier's noncompliance is 
``willful or repeated.''9  For a violation to be willful, it need 
not be intentional.10  In exercising our forfeiture authority, we 
are required to take into account ``the nature, circumstances, 
extent, and gravity of the violation and, with respect to the 
violator, the degree of culpability, any history of prior 
offenses, ability to pay, and such other matters as justice may 
require.''11  In addition, the Commission has established 
guidelines for forfeiture amounts and, where there is no specific 
base amount for a violation, retained discretion to set an amount 
on a case-by-case basis.12

     8.   The Commission's forfeiture guidelines do not address 
the specific violation at issue in this proceeding.  In 
determining the proper forfeiture amount in this case, however, 
we are guided by the principle that there may be no more 
important obligation on a carrier's part than protection of its 
subscribers' proprietary information.  Consumers are increasingly 
concerned about the security of their sensitive, personal data 
that they must entrust to their various service providers, 
whether they are financial institutions or telephone companies.  
Given the increasing concern about the security of this data, and 
evidence that the data appears to be widely available to third 
parties, we must take aggressive, substantial steps to ensure 
that carriers implement necessary and adequate measures to 
protect their subscribers' CPNI as required by the Commission's 
existing CPNI rules.  In this case, AT&T has apparently not 
complied with the Commission's rules, as evidenced by the 
apparent absence of the required compliance certification.  Based 
on all the facts and circumstances present in this case, we 
believe a proposed forfeiture of $100,000 is warranted.13

     9.   AT&T will have the opportunity to submit further 
evidence and arguments in response to this NAL to show that no 
forfeiture should be imposed or that some lesser amount should be 
assessed.14 

V.   CONCLUSION AND ORDERING CLAUSES

     10.  We have determined that AT&T has apparently violated 
Section 64.2009(e) of the Commission's rules by failing to 
prepare and maintain a certification in compliance with the rule.  
We find AT&T apparently liable for $100,000.

     11.  ACCORDINGLY, IT IS ORDERED THAT, pursuant to Section 
503(b) of the Communications Act of 1934, as amended,15 Section 
1.80(f)(4) of the Commission's rules,16 and authority delegated 
by Sections 0.111 and 0.311 of the Commission's rules,17 AT&T IS 
LIABLE FOR A MONETARY FORFEITURE in the amount of one hundred 
thousand dollars ($100,000) for willfully or repeatedly violating 
Section 64.2009 of the Commission's rules, by failing to prepare 
and maintain a certificate that complies with 64.2009(e).

     12.  IT IS FURTHER ORDERED THAT, pursuant to section 1.80 of 
the Commission's Rules, within thirty days of the release date of 
this NOTICE OF APPARENT LIABILITY, AT&T SHALL PAY the full amount 
of the proposed forfeiture or SHALL FILE a written statement 
seeking reduction or cancellation of the proposed forfeiture.

     13.  Payment of the forfeiture must be made by check or 
similar instrument, payable to the order of the Federal 
Communications Commission.  The payment must include the 
NAL/Acct. No. and FRN No. referenced above.  Payment by check or 
money order may be mailed to Federal Communications Commission, 
P.O. Box 358340, Pittsburgh, PA 15251-8340.  Payment by overnight 
mail may be sent to Mellon Bank/LB 358340, 500 Ross Street, Room 
1540670, Pittsburgh, PA 15251.  Payment by wire transfer may be 
made to ABA Number 043000261, receiving bank Mellon Bank, and 
account number 911-6106.  Requests for payment of the full amount 
of this NAL under an installment plan should be sent to Chief, 
Credit and Management Center, 445 12th Street, S.W., Washington, 
D.C.  20554.
     14.  IT IS FURTHER ORDERED that a copy of this Order shall 
be sent by Certified Mail, Return Receipt Requested to AT&T 
Corporation.




                    FEDERAL COMMUNICATIONS COMMISSION



                    Kris A. Monteith
                                                                 
Chief, Enforcement Bureau



_________________________

1 See 47 C.F.R.  64.2009(e).
2 See, e.g. http://www.epic.org/privacy/iei/.
3 See id.
4 Section 222 of the Communications Act, 47 U.S.C  222, provides 
that:  ``Every telecommunications carrier has a duty to protect 
the confidentiality of proprietary information of, and relating 
to, other telecommunications carriers, equipment manufacturers, 
and customers, including telecommunication carriers reselling 
telecommunications services provided by a telecommunications 
carrier.'' 
5 In the Matter of Implementation of the Telecommunications Act 
of 1996: Telecommunications Carriers' Use of Customer Proprietary 
Network Information and Other Customer Information and 
Implementation of the Non-Accounting Safeguards of Sections 271 
and 272 of the Communications Act of 1934, as amended, CC Docket 
Nos. 96-115 and 96-149, FCC 98-27, Order and Further Notice of 
Proposed Rulemaking, 13 FCC Rcd 8061 (1998) (``CPNI Order'').  
See also, In the Matter of Implementation of The 
Telecommunications Act Of 1996 Telecommunications Carriers' Use 
Of Customer Proprietary Network Information And Other Customer 
Information; CC Docket No. 96-115, Implementation Of The Non-
Accounting Safeguards Of Sections 271 And 272 Of The 
Communications Act Of 1934, As Amended CC Docket No. 96-149, FCC 
99-223, Order on Reconsideration and Petitions for Forbearance 14 
FCC Rcd 14409 (1999), Released September 3, 1999; see also  In 
The Matter Of Implementation Of The Telecommunications Act Of 
1996:Telecommunications Carriers' Use Of Customer Proprietary 
Network Information And Other Customer Information; CC Docket No. 
96-115 Implementation Of The Non-Accounting Safeguards Of 
Sections 271 And 272 Of The Communications Act Of 1934, As 
Amended CC Docket No. 96-149, 2000 Biennial Regulatory Review -- 
Review Of Policies And Rules Concerning Unauthorized Changes Of 
Consumers' Long Distance Carriers CC Docket No. 00-257 FCC 02-214 
Third Report and Order and Third Further Notice of Proposed 
Rulemaking, 17 FCC Rcd 14860 (2002).
6 47 C.F.R. 64.2009(e).
7 47 C.F.R.  64.2009.
8 Section 503(b)(2)(B) provides for forfeitures against common 
carriers of up to $130,000 for each violation or each day of a 
continuing violation up to a maximum of $1,325,000 for each 
continuing violation.  47 U.S.C.  503(b)(2)(B).  See Amendment 
of Section 1.80 of the Commission's Rules and Adjustment of 
Forfeiture Maxima to Reflect Inflation, 15 FCC Rcd 18221 (2000); 
Amendment of Section 1.80 of the Commission's Rules and 
Adjustment of Forfeiture Maxima to Reflect Inflation, 19 FCC Rcd 
10945 (2004) (increasing maximum forfeiture amounts to account 
for inflation).
9 47 U.S.C.  503(b)(1)(B).  The Commission has authority under 
this section of the Act to assess a forfeiture penalty against a 
common carrier if the Commission determines that the carrier has 
``willfully or repeatedly'' failed to comply with the provisions 
of the Act or with any rule, regulation, or order issued by the 
Commission under the Act.  The section provides that the 
Commission must assess such penalties through the use of a 
written notice of apparent liability or notice of opportunity for 
hearing.  See 47 U.S.C.  503(b)(4)(A).  Here, as described 
above, AT&T's actions were willful as it apparently failed to 
prepare the required compliance certification. 
10 Southern California Broadcasting Co., 6 FCC Rcd 4387 (1991).
11    See 47 U.S.C.  503(b)(2)(D); see also The Commission's 
Forfeiture Policy Statement and Amendment of Section 1.80 of the 
Commission's Rules, 12 FCC Rcd 17087 (1997) (``Forfeiture Policy 
Statement''); recon. denied, 15 FCC Rcd 303 (1999).

12 Forfeiture Policy Statement, 12 FCC Rcd 17098-99,  22.
13 47 U.S.C.  503(b)(4)(A).
14   47 U.S.C.  503(b)(4)(C); 47 C.F.R.  1.80(f)(3).

15 47 U.S.C.  503(b).
16 47 U.S.C.  1.80(f)(4).
17 47 C.F.R.  0.111, 0.311.