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Before the
Federal Communications Commission
Washington, D.C. 20554
In the Matter of )
)
Primus Telecommunications, Inc. )
) File No. EB-03-TC-162
) NAL/Acct. No. 200432170006
Compliance with the ) FRN: 0004317798
Commission's )
Rules and Regulations Governing )
the National Do-Not-Call )
Registry
ORDER
Adopted: September 3, 2004
Released: September 7, 2004
By the Chief, Enforcement Bureau:
1. In this Order, we adopt the attached Consent Decree
entered into between the Enforcement Bureau and Primus
Telecommunications, Inc. (``Primus''). The Consent Decree
terminates an investigation initiated by the Enforcement Bureau
regarding potential non-compliance by Primus with the National
Do-Not-Call Requirements contained in Section 227 of the
Communications Act of 1934, as amended (the ``Act'') and Section
64.1200 of the Commission's rules.1
2. The Enforcement Bureau and Primus have negotiated the
terms of a Consent Decree that would resolve this matter and
terminate the investigation. A copy of the Consent Decree is
attached hereto and incorporated by reference.
3. After reviewing the terms of the Consent Decree, we
find that the public interest would be served by adopting the
Consent Decree and terminating the investigation.
4. Accordingly, IT IS ORDERED, pursuant to Section 4(i) of
the Communications Act of 1934, as amended,2 that the attached
Consent Decree IS ADOPTED.
5. IT IS FURTHER ORDERED that the above-captioned
Commission investigation into the matters described herein is
terminated.
FEDERAL COMMUNICATIONS COMMISSION
David H. Solomon
Chief, Enforcement Bureau
Before the
FEDERAL COMMUNICATIONS COMMISSION
Washington, D.C. 20554
In the Matter of )
)
Primus Telecommunications, Inc. ) File No. EB-03-TC-162
)
Compliance with the Commission's) FRN: 0004317798
Rules and Regulations Governing )
the National Do-Not-Call Registry )
CONSENT DECREE
I. INTRODUCTION
1. The Enforcement Bureau (``Bureau'') of the Federal
Communications Commission (the ``FCC'' or ``Commission'') and
Primus Telecommunications, Inc. (``Primus''), by their authorized
representatives, hereby enter into this Consent Decree for the
purpose of terminating the Bureau's investigation into possible
noncompliance by Primus with the requirements of Section 227 of
the Communications Act of 1934, as amended (the ``Act'') and
Section 64.1200(c) of the Commission's Rules.3
II.BACKGROUND
2. Primus, headquartered in McLean, Virginia, is the
principal U.S. operating subsidiary of Primus Telecommunications
Group, Inc., a global facilities-based telecommunications
services provider offering international and domestic voice,
Internet and data services to business and residential retail
customers, as well as to other carriers. Primus holds numerous
authorizations to provide telecommunications services from the
FCC and state public utility commissions. Approximately 40
percent of Primus's sales come from telemarketing to consumers.
Primus does not engage, however, in direct telemarketing to
residential consumers. In September 2003, Primus hired a third
party telemarketer, Spanco Telesystems & Solutions, Ltd.
(``Telemarketer''), to conduct telemarketing on its behalf.
3. In a letter to Primus dated December 17, 2003, the
Bureau commenced an investigation concerning Primus's
telemarketing practices to residential consumers in connection
with calls made on behalf of the company to consumers who had
registered their telephone numbers on the National Do-Not-Call
Registry.4
4. During the course of the Investigation, Primus provided
written responses to the Letters of Inquiry on January 23, 2004,
March 11, 2004, and April 27, 2004. Primus represents that
before the National Do-Not-Call rules became effective, it had
developed and implemented an internal system designed to ensure
that no telemarketing calls would be placed to consumers who had
placed their names on the National Do-Not-Call Registry, and it
submitted a description of its internal system and procedures for
implementing the National Do-Not-Call requirements. Further,
Primus established that it had paid for and properly accessed the
National Do-Not-Call Registry database as soon as it became
available. Upon receipt of the Dec. 17 Letter of Inquiry,
Primus represents that it instructed its Telemarketer to halt
outbound telemarketing on Primus's behalf.
III. DEFINITIONS
5. For purposes of this Consent Decree, the following
definitions shall apply:
1.a. ``Act'' means the Communications Act of 1934,
as amended.
1.b. ``Bureau'' means the Enforcement Bureau of
the Federal Communications Commission.
1.c. ``Commission'' means the Federal
Communications Commission.
1.d. ``Effective date'' means the date on which
the Bureau releases the Adopting Order.
1.e. ``Investigation'' means the investigation and
any related proceedings commenced by the Bureau's
Letter of Inquiry, December 17, 2003, to Primus
regarding possible noncompliance by Primus with the
requirements contained in Section 227 of the Act and
Section 64.1200(c) of the Commission's Rules during
the period of October 1, 2003, through December 31,
2003, which possible noncompliance with Section 227
and Section 64.1200(c) shall include, for purposes
of this Consent Decree, all complaints that were or
could have been made against Primus for
telemarketing calls made during the same period.
1.f. ``Order'' or ``Adopting Order'' means an
Order of the Bureau adopting the terms and
conditions of this Consent Decree without change,
addition, or modification, and formally terminating
the above-captioned Investigation.
1.g. ``Parties'' means Primus and the Bureau.
1.h. ``Primus'' means Primus Telecommunications,
Inc. and any telecommunications carrier subsidiary,
successor, or telecommunications carrier controlled
by Primus Telecommunications, Inc.
IV.AGREEMENT
6. Primus agrees that the Bureau has jurisdiction over it
and the subject matter contained in this Consent Decree and the
authority to enter into and adopt this Consent Decree.
7. The Parties agree and acknowledge that this Consent
Decree shall constitute a final settlement of the Investigation
between Primus and the Bureau. In express reliance on the
covenants and representations contained herein, the Bureau agrees
to terminate the Investigation. In consideration for the
termination of this Investigation and in accordance with the
terms of this Consent Decree, Primus agrees to the terms,
conditions and procedures contained herein.
8. The Parties agree that this Consent Decree does not
constitute either an adjudication on the merits or a factual or
legal finding or determination regarding any compliance or
noncompliance by Primus with the requirements of the Act or the
Commission's rules or orders. The Parties agree that this
Consent Decree is for settlement purposes only and that by
agreeing to this Consent Decree, Primus does not admit or deny
any noncompliance, violation or liability associated with or
arising from its actions or omissions involving the Act or the
Commission's rules that are the subject of this Consent Decree.
9. In consideration for the termination of the
Investigation in accordance with the terms of this Consent
Decree, Primus agrees to voluntarily implement a Telemarketing
Compliance Program consisting of the components delineated below.
(a) Not later than 30 days after the Effective Date,
Primus will adopt written policies and procedures
regarding outbound telemarketing campaign management
and the creation, approval and distribution to
telemarketing companies engaged by Primus
(``Telemarketing Companies'' and each a
``Telemarketing Company'') of lists of potential
customers and telephone numbers (``Call Lists'').
Primus will also adopt written policies, which shall
be available upon request, for maintaining its
internal Do-Not-Call list. Primus's written
policies and procedures, which will be memorialized
in a Telemarketing Compliance Manual, will include
the following requirements:
(i) All Call Lists shall be scrubbed against a
version of the National Do-Not-Call Registry
that has been obtained from the administrator of
the Registry not more than 31 days prior to the
date of any call made on Primus's behalf and a
version of Primus's in-house do-not-call list
(``Primus Do-Not-Call List'') that has been
updated by Primus not more than 30 days prior to
the date of any call made on Primus's behalf;
(ii) No outbound telemarketing campaign may be
initiated on Primus's behalf without prior
written authorization from Primus confirming
that the Call Lists have been scrubbed against
the National Do-Not-Call Registry and the Primus
Do-Not-Call List;
(iii) The Telemarketing Company shall generate and
transmit to Primus on a daily basis compliance
reports containing data on all do-not-call
complaints and requests received by the vendor;
and
(iv) Each outbound telemarketing campaign shall be
monitored for compliance by Primus through the
audit procedures described in Para. 9(g), below.
(b) Not later than 30 days after the Effective Date,
Primus will provide the Telemarketing Compliance
Manual to its employees involved in telemarketing
and in the customer service department. Primus will
require these employees to acknowledge in writing
that they have read, understand, and will abide by
the policies and procedures in the Telemarketing
Compliance Manual.
(c) Not later than 30 days after the Effective Date,
Primus will provide the Telemarketing Compliance
Manual to Telemarketing Companies. Primus will
require each Telemarketing Company to sign an
acknowledgement that it has read, understands, and
will abide by the policies and procedures in the
Telemarketing Compliance Manual.
(d) Not later than 30 days after the Effective Date,
Primus will commence training of its employees
involved in telemarketing campaign management and
its customer service representatives. The training
will include the following components:
(i) Distribution to employees of written training
materials, including: Primus's Telemarketing
Compliance Manual, a ``FAQs'' document providing
answers to frequently asked questions about the
National Do-Not-Call rules and the Primus Do-
Not-Call List; flow charts depicting the process
customer service representatives are required to
follow when receiving a do-not-call request or
complaint; and a copy of Primus's written policy
for complying with National Do-Not-Call rules
and maintaining the Primus Do-Not-Call List.
(ii) A training session given by the Primus Do-
Not-Call Team (which consists of Primus's Vice
President for Customer Care, Systems
Administrator, Marketing Manager, and Regulatory
Attorney), which will explain Primus's policies
and procedures for telemarketing compliance and
permit its employees to ask questions about the
policies and procedures. Primus will require
these employees to acknowledge in writing that
they have attended the training session and
understand and will abide by Primus's policies
and procedures.
(iii) Primus will require new employees involved in
telemarketing campaign management and hired as
customer service representatives to complete
such training within the first week of
employment. Primus will require all employees
involved in telemarketing campaign management
and all customer service representatives to
attend refresher training at least once a year.
(e) Not later than 30 days after the Effective Date,
Primus will prepare and distribute an Escalation
Alert document that will identify the data criteria
by which Primus will evaluate Telemarketing Company
Reports or Customer Care Reports (see Para. 9(g)
(audit procedures) below) and, if such criteria are
met, will trigger escalation of the report to the
next level of telemarketing compliance management.
The Escalation Alert document will identify for each
level of escalation the Primus manager (and an
alternate) to whom such report shall be forwarded
and the minimum timeframe within which notification
shall be made. The Escalation Alert document will
identify a clear path of successive levels of
escalation, which will ensure that Primus can
promptly identify and respond to data indicating a
failure or potential failure of telemarketing
compliance. The ``Escalation Alert'' process will
be administered by Primus.
(f) Primus's contracts with Telemarketing Companies
will provide that:
(i) The Telemarketing Company shall comply with all
applicable federal and state telemarketing laws
and requirements, including the requirement that
the Telemarketing Company use a process to
prevent unauthorized use of the National Do-Not-
Call database and refrain from participating in
cost-sharing arrangements;
(ii) The Telemarketing Company shall comply with
Primus's policies and procedures set forth in
Primus's Telemarketing Compliance Manual,
including the requirement that the Telemarketing
Company maintain and preserve all reports and
records required by law, and all supplemental
instructions from Primus;
(iii) The Telemarketing Company shall transmit to
Primus on a daily basis reports that identify
and provide data for each complaint or request
relating to do-not-call and other telemarketing
issues (``Telemarketing Company Reports''); and
(iv) Primus will take appropriate action in the
event that any Telemarketing Company Report or
any other source establishes that a
Telemarketing Company has failed to follow its
legal obligations or Primus's policies with
respect to the Commission's Do-Not-Call rules.
Violation of such legal obligations and Primus's
policies shall be grounds for termination of the
Telemarketing Company's contract with Primus.
(g) Not later than 60 days after the Effective Date,
Primus will implement procedures to audit compliance
with the Commission's Do-Not-Call rules, through the
following procedures and additional measures to be
determined by Primus:
(i) Telemarketing Company Reports. Primus will
require its Telemarketing Companies to provide
the Primus Do-Not-Call Team a daily written
report containing data for each and every
complaint or request relating to do-not-call and
other telemarketing issues received by the
Telemarketing Company.
(ii) Customer Care Reports. Primus will require
its Vice President of Customer Care to provide
the Primus Do-Not-Call Team a weekly report
containing data for each and every do-not-call
complaint and request to be placed on the Primus
Do-Not-Call List received by Primus's customer
service representatives.
(iii) Telemarketing Campaign Management Reports.
Primus will require the Primus Do-Not-Call Team
to issue to the Legal Department and Vice
President for Customer Service, a weekly report
summarizing the status of compliance for each
active telemarketing campaign, which report
shall be based upon the daily Telemarketing
Company Reports and weekly Customer Care
Reports.
(iv) ``Failsafe'' mechanisms designed to prevent
noncompliance due to human error. These
mechanisms may include ``seeding'' Call Lists
with names of Primus representatives who are
registered on the National Do-Not-Call Registry
and/or the Primus Do-Not-Call List; the
testing/auditing of the Telemarketing Company's
response to verbal requests by Primus employees
not to be called again and to be placed on
Primus's Do-Not-Call list; monitoring of the
Telemarketing Company's responses to questions
about the Do-Not-Call requirements.
(h) Not later than 30 days after the Effective Date,
Primus will create a register that centralizes all
compliance reports and telemarketing agreements
associated with each Primus telemarketing campaign.
Primus will designate a register manager, who will
be responsible for maintaining and updating the
register.
(i) Not later than 60 days after the Effective Date, and
every 180 days thereafter, Primus will submit a
written report to the Bureau of its compliance with
this Consent Decree, including in the first report,
its progress in implementing its Compliance Program.
(j) Primus will not commence telemarketing until the
Compliance Program has been implemented and will
give the Bureau not less than 14 days prior written
notice of its intent to commence telemarketing.
(k) Primus will maintain and make available to the
Bureau, within 14 days of receipt of any specific
request from the Bureau, business records
documenting its compliance with the terms and
provisions of this Consent Decree.
(l) Primus will give the Bureau 30 days prior written
notice of any change in its legal status, including
a name change, a change of control, merger,
reorganization, or dissolution.
10. Primus agrees to make a voluntary contribution to the
United States Treasury, without further protest or recourse to a
trial de novo, in the amount of $400,000 within ten (10) business
days after the Effective Date of the Adopting Order. The payment
must be made by check or similar instrument, payable to the order
of the Federal Communications Commission. The payment must
include the Acct. No. and FRN No. referenced above. Payment by
check or money order may be mailed to Forfeiture Collection
Section, Finance Branch, Federal Communications Commission, P.O.
Box 73482, Chicago, Illinois, 60673-7482. Payment by overnight
mail may be sent to Bank One/LB 73482, 525 West Monroe, 8th Floor
Mailroom, Chicago, IL 60661. Payment by wire transfer may be
made to ABA Number 071000013, receiving bank Bank One, and
account number 1165259.
11. The Bureau agrees that it will not use the facts
developed in this Investigation through the Effective Date or the
existence of this Consent Decree to initiate, on its own motion,
any new proceeding, formal or informal, or take any action on its
own motion against Primus, including any other enforcement
action, nor will the Bureau seek any administrative or other
penalties from Primus concerning the matters that were the
subject of the Investigation. The Bureau also agrees that it
will not use the facts developed in the Investigation through the
Effective Date or the existence of this Consent Decree to
initiate, on its own motion, any proceeding, formal or informal,
or take any action on its own motion against Primus with respect
to Primus's basic qualifications to be a Commission licensee.
Consistent with the foregoing, nothing in this Consent Decree
limits the Commission's authority to consider and adjudicate any
formal complaint that may be filed pursuant to Section 208 of the
Act, 47 U.S.C. § 208, and to take any action in response to such
complaint.
12. Primus's decision to enter into this Consent Decree is
expressly contingent upon the Bureau's issuance of an Order that
is consistent with this Consent Decree, and which adopts the
Consent Decree without change, addition or modification.
13. Provided the Bureau issues an Order adopting the
Consent Decree without change, addition or modification, Primus
waives any and all rights it may have to seek administrative or
judicial reconsideration, review, appeal or stay, or to otherwise
challenge or contest the validity of this Consent Decree and the
Order adopting this Consent Decree.
14. In the event that this Consent Decree is rendered
invalid by a court of competent jurisdiction, it shall become
null and void and may not be used in any manner in any legal
proceeding.
15. By this Consent Decree, Primus neither waives nor
alters its right to assert and seek protection from disclosure of
any privileged or otherwise confidential and protected documents
and information, or to seek appropriate safeguards of
confidentiality for any competitively sensitive or proprietary
information.
16. Primus agrees that any violation of the Order or of
this Consent Decree shall constitute a separate violation of a
Commission order, entitling the Commission to exercise any rights
and remedies attendant to the enforcement of a Commission order.
17. The Parties agree that if any provision of this Consent
Decree conflicts with any subsequent rule or order adopted by the
Commission (except an order specifically intended to revise the
terms of this Consent Decree to which Primus does not consent),
that provision will be superceded by such Commission rule or
order.
18. The Parties agree that the requirements of this Consent
Decree shall expire thirty-six (36) months from the Effective
Date.
19. This Consent Decree may be signed in counterparts.
For: Primus Telecommunications, Inc.
_________________ ___________________________________________
Date Walter L. Stone
For: Enforcement Bureau
Federal Communications Commission
_________________ ___________________________________________
Date David H. Solomon
_________________________
1 47 U.S.C. § 227; 47 C.F.R. § 64.1200.
2 47 U.S.C. § 154(i).
3 47 U.S.C. § 227; 47 C.F.R. § 64.1200(c).
4 See Letter from Kurt A. Schroeder, Deputy Chief,
Telecommunications Consumers Division, Enforcement Bureau,
Federal Communications Commission, to Paul K. Singh, Primus,
dated December 17, 2003 (``Dec. 17 Letter of Inquiry''); see
also Letter from Kurt A. Schroeder, Deputy Chief,
Telecommunications Consumers Division, Enforcement Bureau,
Federal Communications Commission, to Walter L. Stone, Primus,
dated February 20, 2004 (``Feb. 20 Letter of Inquiry'',
together with the Dec. 17 Letter of Inquiry, ``Letters of
Inquiry'').