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FOR IMMEDIATE RELEASE NEWS MEDIA CONTACT:
September 20, 2010 Eric Bash
(202) 418-2057
eric.bash@fcc.gov
ENFORCEMENT BUREAU SETTLES INVESTIGATIONS OF
PURPLE COMMUNICATIONS, INC.
Settlement Requires Payments in Excess of $22 Million for Alleged Abuse of
Fund
That Supports Vital Service for Persons with Hearing or Speech
Disabilities
Today, the FCC's Enforcement Bureau released a consent decree with Purple
Communications, Inc. that requires the company to pay approximately $22
million to the Telecommunications Relay Service (TRS) Fund, resolving
Bureau investigations into whether Purple overbilled the TRS Fund by
artificially inflating TRS usage. TRS is a vital service that allows
people with hearing or speech disabilities to communicate over the
telephone -- through an interpreter -- with people who do not have such
disabilities. The Americans with Disabilities Act established the TRS
Fund, under the FCC's oversight, to ensure that individuals with hearing
or speech disabilities who use TRS can do so at the same rates hearing
people pay for regular telephone service. TRS providers like Purple are
paid for their services through the TRS Fund. Further information about
TRS is available at the FCC's website at
http://www.fcc.gov/cgb/consumerfacts/trs.html.
The issues under investigation by the Enforcement Bureau included whether
the company unlawfully offered financial incentives or rewards simply to
inflate TRS usage and billables, and double-recovered for certain
business-related calls. The $22 million settlement resolves the Bureau's
investigation, establishes the terms of Purple's repayment of the TRS
Fund, and creates a robust compliance framework for Purple's continued
provision of TRS.
Under the terms of the settlement, Purple must:
* repay $18.5 million to the TRS Fund over a period of five years, plus
an additional $3.1 million in interest and penalties;
* make a $550,000 payment to the U.S. Treasury; and
* adopt a detailed compliance plan designed to ensure that the company
strictly adheres to the Commission's TRS rules.
The Compliance Plan required by the settlement obligates Purple to
appoint a compliance director, establish an FCC Regulatory Committee of
its Board of Directors to ensure high-level management oversight of its
compliance efforts, provide comprehensive training to all employees
regarding FCC regulations, conduct detailed compliance reviews of all
programs involving the generation of new TRS business, certify to the
accuracy of its requests for reimbursement from the TRS Fund, review those
submissions for anomalous calling patterns that could indicate misuse of
TRS, and immediately take steps to correct any incorrect reimbursement
requests.
FCC Enforcement Bureau Chief Michele Ellison stated: "We simply will not
tolerate abuse of the TRS Fund. Every dollar misappropriated from this
Fund is ultimately a dollar taken from consumers. Today's settlement
strikes the right balance: it requires full repayment of the TRS Fund and
compels an overhaul of Purple's business practices; at the same time, it
enables Purple to continue providing vital relay services to individuals
with hearing or speech disabilities. We will remain vigilant in
protecting the public trust -- the millions of Americans with hearing or
speech disabilities deserve no less."
Ms. Ellison also said: "I want to express my appreciation for the
cooperative efforts of our FCC colleagues who worked with the Enforcement
Bureau to resolve this matter, particularly those in the Office of General
Counsel, Office of the Managing Director, and Consumer and Governmental
Affairs Bureau."
-- FCC --
2
NEWS
Federal Communications Commission
445 12th Street, S.W.
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. Circ 1974).
News Media Information 202 / 418-0500
Internet: http://www.fcc.gov
TTY: 1-888-835-5322