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

In the Matter of                 )    File No. EB-04-IH-0587
                                )
                                )
Telecom Management, Inc.         )    NAL/Acct. No. 200532080142
                                )
                                )
Apparent Liability for           )    FRN No. 0005-8591-11
Forfeiture                       )

                  NOTICE OF APPARENT LIABILITY 
                         FOR FORFEITURE


Adopted:  August 12, 2005                    Released:  August 
12, 2005

By the Commission:

I.   INTRODUCTION 

     1.   In this Notice of Apparent Liability for Forfeiture 
(``NAL''), we find that Telecom Management, Inc. (``Telecom 
Management'' or ``TMI''), d/b/a Pioneer Telephone, a 
telecommunications carrier that has been operating since 2002 and 
at least indirectly benefiting from federal programs supporting 
the telecommunications industry since that time, apparently 
failed to meet its statutory and regulatory obligations related 
to those programs.  Based upon the facts and circumstances 
surrounding this matter, we conclude that TMI is apparently 
liable for a total forfeiture of $280,000.

     2.   Specifically, we find that TMI has apparently violated 
sections 254(d) of the Communications Act of 1934, as amended 
(the ``Act''),1 and section 54.706(a) of the Commission's rules 
by willfully and repeatedly failing to contribute to the 
Universal Service Fund (``USF'').2  We further find that TMI has 
apparently violated sections 1.1154 and 1.1157(b)(1) of the 
Commission's rules3 by failing to pay regulatory fees to the 
Commission.  

II.  BACKGROUND

     3.   The Commission is charged by Congress with regulating 
interstate and international telecommunications and ensuring that 
providers of such telecommunications comply with the requirements 
imposed on them by the Act and our rules.4  The Commission also 
has been charged by Congress to establish, administer and 
maintain various telecommunications regulatory programs, which 
are described in more detail below, and to fund these programs 
through assessments on the telecommunications providers that 
benefit from them.  To accomplish these goals, the Commission 
established ``a central repository of key facts about carriers'' 
through which it could monitor the entry and operation of 
interstate telecommunications providers to ensure, among other 
things, that they are qualified, do not engage in fraud, and do 
not evade oversight.5  First, Commission rules require that, upon 
entry or anticipated entry into interstate telecommunications 
markets, telecommunications carriers must register by submitting 
information on an FCC Form 499-A, also known as the annual 
Telecommunications Reporting Worksheet (``Worksheet'').6  The 
Commission also requires telecommunications providers to submit 
financial information on their annual and, with certain 
exceptions not applicable to TMI, quarterly short-form Worksheets 
to enable the Commission to determine and collect the statutorily 
mandated program assessments.7

     4.   The Telecommunications Act of 1996 codified Congress's 
historical commitment to promote universal service to ensure that 
consumers in all regions of the nation have access to affordable, 
quality telecommunications services.8  In particular, section 
254(d) of the Act requires, among other things, that ``[e]very 
telecommunications carrier [providing] interstate 
telecommunications services . . . contribute, on an equitable and 
nondiscriminatory basis, to the specific, predictable, and 
sufficient mechanisms established by the Commission to preserve 
and advance universal service.''9  In implementing this 
Congressional mandate, the Commission directed all 
telecommunications carriers providing interstate 
telecommunications services and certain other providers of 
interstate telecommunications to contribute to the Universal 
Service Fund based upon their interstate and international end-
user telecommunications revenues.10  Failure by some providers to 
pay their share into the Fund skews the playing field by 
providing non-paying providers an economic advantage over their 
competitors, who must then shoulder more than their fair share of 
the costs of the Fund.

     5.   Pursuant to section 9(a)(1) of the Act and section 
1.1151 of the Commission's rules, interstate telecommunications 
and other providers must pay regulatory fees to the Commission to 
cover the costs of certain regulatory activities.11  In 
particular, sections 1.1154 and 1.1157(b)(1) of the Commission's 
rules require that interstate telecommunications carriers pay 
regulatory fees on the basis of their interstate and 
international end-user revenues.12  Such fees must be paid on an 
annual basis,13 and failure to do so subjects a carrier to late 
payment penalties, as well as possible revocation of its 
operating authority.14  Further, under the Commission's ``red 
light rule,'' action will be withheld on any application to the 
Commission or request for authorization made by any entity that 
has failed to pay when due its regulatory fees or any other 
program payment, such as USF contributions, and if payment or 
payment arrangements are not made within thirty days from notice 
to the applicant, such applications or requests will be 
dismissed.15

     6.   The Commission has established specific procedures to 
administer the programs for universal service and regulatory 
fees.  In addition to its obligation to register, a carrier is 
required to file Worksheets for the purpose of determining its 
USF and regulatory fee program payments,16 and, with certain 
exceptions, to file quarterly short-form Worksheets to determine 
monthly universal service contribution amounts.  These periodic 
filings trigger a determination of liability, if any, and 
subsequent billing and collection, by the entities that 
administer the regulatory programs.  For example, USAC uses the 
revenue projections submitted on the quarterly filings to 
determine each carrier's universal service contribution amount.17  
Carriers are required to pay their monthly USF contribution by 
the date shown on their invoice.18  The Commission's rules 
explicitly warn contributors that failure to file their forms or 
submit their payments potentially subjects them to enforcement 
action.19 

     7.   Telecom Management is a Maine-based telecommunications 
service provider of, among other services, long distance plans, 
toll free numbers, and phone cards.20  TMI provides these by 
reselling interstate, interexchange services purchased from 
Global Crossing Bandwidth, Inc. (``Global Crossing'').21  TMI has 
provided telecommunications services since 2002.22  

     8.   In 2004, the Enforcement Bureau (``Bureau'') audit 
staff sought to identify resellers of telecommunications service 
that may have failed to register as telecommunications service 
providers with the Commission and, thus, may also have failed to 
satisfy various Commission program requirements.23  To identify 
such resellers, the Bureau audit staff compared lists of 
resellers provided by wholesale service providers against the 
Commission's central repository of registered telecommunications 
service providers with filer identification numbers.  If a 
reseller did not appear to have an identification number, the 
audit staff sent an inquiry to that reseller.  On March 30, 
200424 and June 18, 2004,25 the Bureau's audit staff sent letters 
to TMI at the address provided by its telecommunications 
wholesale service provider, Global Crossing, requesting 
information pertaining to TMI's compliance with the Commission's 
registration requirement.  After receiving no response, the 
Bureau issued a letter of inquiry (``LOI'') on November 18, 2004, 
directing TMI, among other things, to submit a sworn written 
response to a series of questions relating to TMI's alleged 
failure to satisfy its registration, filing and payment 
obligations.26  TMI filed its response, which included documents 
and information required by the LOI, on December 20, 2004,27 and 
supplemented that response on January 17, 2005.28  
`
     9.   TMI's responses confirmed that the carrier had not met 
its contribution requirements to the aforementioned programs 
supporting the telecommunications industry despite operating as 
an interstate telecom carrier for more than two years.29  TMI 
made its first payments to the USF and FCC regulatory fees 
program more than two years after it began providing interstate 
telecommunications services.  

III. DISCUSSION

     10.  Under section 503(b)(1)(B) of the Act, any person who 
is determined by the Commission to have willfully or repeatedly 
failed to comply with any provision of the Act or any rule, 
regulation, or order issued by the Commission shall be liable to 
the United States for a forfeiture penalty.30  To impose such a 
forfeiture penalty, the Commission must issue a notice of 
apparent liability, and the person against whom the notice has 
been issued must have an opportunity to show, in writing, why no 
such forfeiture penalty should be imposed.31  The Commission will 
then issue a forfeiture if it finds by a preponderance of the 
evidence that the person has violated the Act or a Commission 
rule.32  As set forth below, we conclude under this standard that 
TMI is apparently liable for forfeiture for its apparent willful 
and repeated violations of section 254(d) of the Act33 and 
sections 54.706(a), 1.1154, and 1.1157(b)(1) of the Commission's 
rules.34

     11.  The fundamental issues in this case are whether TMI 
apparently violated the Act and the Commission's rules by:  (1) 
willfully or repeatedly failing to make requisite contributions 
toward the Universal Service Fund; and (2) willfully or 
repeatedly failing to pay regulatory fees to the Commission.  We 
answer these questions in the affirmative.  Based on a 
preponderance of the evidence, we conclude that TMI is apparently 
liable for a forfeiture of $280,000 for apparently willfully and 
repeatedly violating section 254(d) of the Act35 and sections 
54.706(a), 1.1154, and 1.1157(b)(1) of the Commission's rules.36

     12.  Specifically, we propose the following forfeitures for 
apparent violations within the last year: (1) $270,000 for 
failure to make USF contributions for the months August through 
October, 2004; and (2) $10,000 for failure to make its 2004 FCC 
regulatory fee payment when due on August 19, 2004 until December 
2004.  Although we propose forfeitures only for apparent 
violations within the last year, we discuss below the history of 
TMI's noncompliance in prior years to demonstrate the scope of 
TMI's misconduct and to provide sufficient context for the 
misconduct that is within the statute of limitations period and 
thus covered by this NAL.  

     A.   Universal Service Contributions

     13.  We conclude that TMI has apparently violated section 
254(d) of the Act and section 54.706 of the Commission's rules by 
failing to contribute to universal service support mechanisms.37  
Section 54.706(c) unambiguously directs that ``entities 
[providing] interstate telecommunications to the public . . . for 
a fee . . . contribute to the universal service support 
programs.''38  ``Interstate telecommunications'' include, among 
other things, ``resale of interstate services'' such as those 
provided by TMI.39  Although TMI has been providing interstate 
telecommunications services since 2002,40 TMI made no universal 
service contributions until November 8, 2004.41  As we previously 
have stated,

       [c]arrier nonpayment of universal service 
       contributions undermines the efficiency and 
       effectiveness of the universal service support 
       mechanisms.  Moreover, delinquent carriers may 
       obtain a competitive advantage over carriers 
       complying with the Act and our rules.  We consider 
       universal service nonpayment to be a serious threat 
       to a key goal of Congress and one of the 
       Commission's primary responsibilities.42  

Based on the preponderance of the evidence, we find that TMI has 
apparently violated section 254(d) of the Act and section 
54.706(a) of the Commission's rules by willfully and repeatedly 
failing to make any universal service contributions from 2002 to 
October 2004.  

     B.   Payment of Regulatory Fees

     14.  We also conclude that TMI apparently has violated 
sections 1.1154 and 1.1157(b)(1) of the Commission's rules by 
failing to pay, and untimely paying, required regulatory fees to 
the Commission for two years.43  As an interstate telephone 
service provider, TMI was apparently required as early as 2003 to 
pay regulatory fees on the basis of its interstate and 
international end-user revenues.44  TMI, however, made its first 
fee payment, covering the 2004 fiscal year, on December 28, 2004 
- nine months after the Bureau's compliance review identified TMI 
as a non-filer and over four months past the August 19, 2004 
filing deadline for 2004 regulatory fee payments.45  For these 
reasons, we find that TMI apparently has violated sections 1.1154 
and 1.1157(b)(1) of the Commission's rules by willfully and 
repeatedly failing to pay regulatory fees program payments when 
due, including one such failure in the past year. 




     C.   Proposed Forfeiture

     15.  Section 503(b)(1)(B) of the Act provides that any 
person that willfully or repeatedly fails to comply with any 
provision of the Act or any rule, regulation, or order issued by 
the Commission, shall be liable to the United States for a 
forfeiture penalty.46  For the apparent violations in this case, 
section 503(b)(2)(B) of the Act authorizes the Commission to 
assess a forfeiture of up to $120,000 for each violation or each 
day of a continuing violation, up to a statutory maximum of $1.2 
million for a single act or failure to act for violations 
occurring before September 7, 2004, and up to $130,000 for each 
violation or each day of a continuing violation, up to a 
statutory maximum of $1.325 million for a single act or failure 
to act for violations occurring on or after September 7, 2004.47  
In determining the appropriate forfeiture amount, we consider the 
factors enumerated in section 503(b)(2)(D) of the Act, including 
``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.''48

     16.  Under section 503(b)(6) of the Act, we may only propose 
forfeitures for apparent violations that accrued within one year 
of the date of this NAL.49  Nevertheless, section 503(b) does not 
bar us from assessing whether TMI's conduct prior to that time 
period apparently violated the Act or our rules in determining 
the appropriate forfeiture amount for those violations within the 
statute of limitations.50  Therefore, although we find that TMI 
apparently violated the Act and our rules for over two years, we 
propose forfeitures here only for violations that occurred within 
the last year.

     17.  Based on the facts above, it appears that TMI has 
failed to make the requisite contributions into the Universal 
Service Fund for a period of over two years.  Nonpayment of 
universal service contributions is an egregious offense that 
bestows on delinquent carriers an unfair competitive advantage by 
shifting to compliant carriers the economic costs and burdens 
associated with universal service.  A carrier's failure to make 
required universal service contributions hampers realization of 
Congress' policy objective in section 254(d) of the Act to ensure 
the equitable and non-discriminatory distribution of universal 
service costs among all telecommunications providers.51  The 
Commission has established a base forfeiture amount of $20,000 
for each month in which a carrier has failed to make required 
universal service contributions.52  Consequently, we initially 
find that TMI is apparently liable for a base forfeiture of 
$60,000 for its failure to make universal service contributions 
for three months within the last year.53  That base amount is, 
however, subject to an upward adjustment.

     18.  In the past, we have calculated upward adjustments to 
forfeitures for failure to make USF payments based on one-half of 
the company's unpaid contributions.54  During the course of this 
investigation, TMI has back-filed the necessary Worksheets for 
USAC to determine TMI's USF contribution assessments, and USAC 
has completed billing for those back-payments.  Based on those 
bills, TMI had an unpaid USF obligation of approximately $420,000 
at the time this investigation began.  Therefore, taking into 
account all the factors enumerated in section 503(b)(2)(D) of the 
Act, we propose an upward adjustment of $210,000 for TMI's 
apparent nonpayment violations.  We thus find TMI liable for a 
total proposed forfeiture of $270,000 for its apparent willful 
and repeated failure to make contributions into the Universal 
Service Fund.

     19.  We also conclude that TMI has apparently failed to make 
any regulatory fee payments to the Commission in 2003, and 
untimely paid the regulatory fee payments for the 2004 fiscal 
year on December 28, 2004, long after its August 19, 2004 due 
date and only after receiving the Bureau's inquiries.  A 
carrier's failure to contribute toward the costs of certain 
regulatory activities from which it benefits undermines the 
efficiency, equitability, and effectiveness of the regulatory fee 
program and accomplishment of Congress' objectives in section 
9(a)(1) of the Act.  In recent orders, the Commission has 
established a base forfeiture amount of $10,000 for failure to 
timely make required regulatory fee payments.55  We, therefore, 
find TMI apparently liable for a $10,000 forfeiture for its 
apparent violation of sections 1.1154 and 1.1157 of the 
Commission's rules.

IV.  CONCLUSION

     20.  In light of the seriousness, duration and scope of the 
apparent violations, and to ensure that a company with 
substantial revenues such as TMI does not consider the proposed 
forfeiture merely ``an affordable cost of doing business,''56 we 
find that a proposed forfeiture of $280,000 is warranted.  As 
discussed, this proposed forfeiture amount includes (1) a total 
proposed penalty of $270,000 for TMI's apparent failure to make 
required universal service contributions for three months in 
2004; and (2) a total proposed penalty of $10,000 for TMI's 
apparent failure to timely make 2004 regulatory fee payments.  

     21.  We caution that additional violations of the Act or the 
Commission's rules could subject TMI to further enforcement 
action.  Such action could take the form of higher monetary 
forfeitures and/or possible revocation of TMI's operating 
authority, including disqualification of TMI's principals from 
the provision of any interstate common carrier services without 
the prior consent of the Commission.57  In addition, we note 
that, to the extent TMI is delinquent on any debt owed to the 
Commission (e.g., has failed to pay all of its USF 
contributions), the Commission will not act on, and may dismiss, 
any application or request for authorization filed by TMI, in 
accordance with the agency's red light rules.58

V.   ORDERING CLAUSES

     22.  ACCORDINGLY, IT IS ORDERED THAT, pursuant to section 
503(b) of the Communications Act of 1934, as amended, 47 U.S.C. § 
503(b), and section 1.80 of the Commission's rules, 47 C.F.R. § 
1.80, that Telecom Management, Inc. is hereby NOTIFIED of its 
APPARENT LIABILITY FOR A FORFEITURE in the amount of $280,000 for 
willfully and repeatedly violating the Act and the Commission's 
rules.

     23.  IT IS FURTHER ORDERED THAT, pursuant to section 1.80 of 
the Commission's Rules,59 within thirty days of the release date 
of this NOTICE OF APPARENT LIABILITY, Telecom Management, Inc. 
SHALL PAY the full amount of the proposed forfeiture or SHALL 
FILE a written statement seeking reduction or cancellation of the 
proposed forfeiture.

     24.  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 Forfeiture Collection Section, 
Finance Branch, 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.

     25.  The response, if any, to this NOTICE OF APPARENT 
LIABILITY must be mailed to William Davenport, Chief, 
Investigations and Hearings Division, Enforcement Bureau, Federal 
Communications Commission, 445 12th Street, S.W., Washington, 
D.C.  20554 and must include the NAL/Acct. No. referenced above.

     26.  The Commission will not consider reducing or canceling 
a forfeiture in response to a claim of inability to pay unless 
the petitioner submits:  (1) federal tax returns for the most 
recent three-year period; (2) financial statements prepared 
according to generally accepted accounting practices (GAAP); or 
(3) some other reliable and objective documentation that 
accurately reflects the petitioner's current financial status.  
Any claim of inability to pay must specifically identify the 
basis for the claim by reference to the financial documentation 
submitted.

     27.  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.  
20554.60

     28.  IT IS FURTHER ORDERED that a copy of this NOTICE OF 
APPARENT LIABILITY shall be sent by certified mail, return 
receipt requested, to Sue Bouchard, Telecom Management, Inc., 583 
Warren Avenue, Portland, ME 04103, and Leon Nowalsky, Counsel for 
Telecom Management, Inc., Nowalsky, Bronston & Gothard, APLLC, 
3500 N. Causeway Blvd, Suite 1442, Metaire, LA 70002.


                         FEDERAL COMMUNICATIONS COMMISSION
                         


                         Marlene H. Dortch
                         Secretary 
_________________________

147 U.S.C. § 254(d).  
247 C.F.R. § 54.706(a).
347 C.F.R. §§ 1.1154, 1.1157(b)(1).
4See, e.g., 47 U.S.C. § 151.
5See Implementation of the Subscriber Carrier Selection 
Provisions of the Telecommunications Act of 1996, Third Report 
and Order and Second Order on Reconsideration, 15 FCC Rcd 15996, 
16024 (2000) (``Carrier Selection Order'').
647 C.F.R. § 64.1195.
7See 47 U.S.C. §§ 159(a),(b); 225(d)(3); 251(e)(2); 254(d).  In 
1999, to streamline the administration of the programs and to 
ease the burden on regulatees, the Commission consolidated the 
information filing requirements for multiple telecommunications 
regulatory programs into the annual Telecommunications Reporting 
Worksheet.  See 1998 Biennial Regulatory Review, Report and 
Order, 14 FCC Rcd 16602 (1999).  The next year the Commission 
revised the Telecommunications Reporting Worksheet slightly to 
collect the additional information necessary to achieve its goal 
of establishing a central repository for interstate 
telecommunications providers by the least provider-burdensome 
method.  Carrier Selection Order, 15 FCC Rcd at 16026.  
8The Telecommunications Act of 1996 amended the Communications 
Act of 1934.  See Telecommunications Act of 1996, Pub. L. No. 
104-104, 110 Stat. 56 (1996) (``1996 Act'').
947 U.S.C. § 254(d).  
1047 C.F.R. § 54.706(b).  Beginning April 1, 2003, carrier 
contributions were based on a carrier's projected, rather than 
historical, revenues.  Id.
11Section 9(a)(1) of the Act directs the Commission to ``assess 
and collect regulatory fees to recover the costs of the following 
regulatory activities of the Commission:  enforcement activities, 
policy and rulemaking activities, user information services, and 
international activities.''  47 U.S.C. § 159(a)(1); see also 47 
C.F.R. § 1.1151.
12See 47 C.F.R. §§ 1.1154, 1.1157(b)(1).
1347 C.F.R. § 1.1157(b)(1).  Section 1.1154 of the Commission's 
rules sets forth the schedule of annual regulatory charges and 
filing locations for common carrier services.  See 47 C.F.R. § 
1.1154.
14See 47 U.S.C. §§ 159(c)(1), (c)(3).
1547 C.F.R. § 1.1910.  The rule went into effect on November 1, 
2004.  See ``FCC Announces Brief Delay in Enforcement of Red 
Light Rule,'' Public Notice, 19 FCC Rcd 19452 (2004).
16Upon submission of a Form 499-A registration, the carrier is 
issued a filer identification number by USAC, which is then 
associated with further filings by the company and used to track 
the carrier's contributions and invoices.
17Individual universal service contribution amounts that are 
based upon quarterly filings are subject to an annual true-up.  
See Federal-State Joint Board on Universal Service, Petition for 
Reconsideration filed by AT&T, Report and Order and Order on 
Reconsideration, 16 FCC Rcd 5748 (2001) (``Quarterly Reporting 
Order''); 47 C.F.R. § 54.709(a).  
18See Globcom, Inc., Notice of Apparent Liability for Forfeiture 
and Order, 18 FCC Rcd 19893, 19896 (2003) (``Globcom''); 47 
C.F.R. § 54.711(a) (``The Commission shall announce by Public 
Notice published in the Federal Register and on its website the 
manner of payment and the dates by which payments must be 
made.'').  See, e.g., ``Proposed Third Quarter 2003 Contribution 
Factor,'' Public Notice, 18 FCC Rcd 11442 (Wir. Comp. Bur. 2003) 
(``Contribution payments are due on the date shown on the [USAC] 
invoice.'')  The Act and our rules, however, do not condition 
payment on receipt of an invoice or other notice from USAC.  See 
47 U.S.C. § 254(d); 47 C.F.R. § 54.706(b).  A carrier that does 
not file may not receive an invoice from USAC, but is nonetheless 
required to contribute to the universal service fund, unless its 
revenues are considered de minimus.  The instructions for the 
Telecommunications Reporting Worksheet include tables for 
carriers to determine their annual contributions.  
1947 C.F.R. § 54.713.
20See Letter from Leon L. Nowalsky, Nowalsky, Bronston & Gothard, 
Counsel for Telecom Management, Inc., to Hillary S. DeNigro, 
Deputy Chief, Investigations and Hearings Division, Enforcement 
Bureau, FCC, dated December 20, 2004 (``TMI December 20, 2004 
Letter''), Response to Inquiry 5.
21See, e.g., 
http://support.pioneertelephone.com/test/support.asp?kb=42 
(providing evidence that TMI utilizes the underlying network of 
Frontier/Global Crossing) (last accessed on July 11, 2005). 
22TMI December 20, 2004 Letter, Response to Inquiry 4.  TMI's 
website states, however, that it is a long-distance service 
provider founded in 1989.  See 
http://support.pioneertelephone.com/test/support.asp?kb=42 (last 
accessed July 11, 2005).  
23See 47 C.F.R. § 64.1195(a).
24See Letter from Hugh L. Boyle, Chief Auditor, Investigations 
and Hearings Division, Enforcement Bureau, FCC, to Telecom 
Management, Inc., dated March 30, 2004 (requesting confirmation 
that Telecom Management had filed registration information 
pursuant to section 64.1195(a) of the Commission's rules) 
(``March 30, 2004 Audit Letter'').
25See Letter from Hugh L. Boyle, Chief Auditor, Investigations 
and Hearings Division, Enforcement Bureau, FCC, to Telecom 
Management, Inc., dated June 18, 2004 (requesting confirmation 
that Telecom Management had filed registration information 
pursuant to section 64.1195(a) of the Commission's rules) (``June 
18, 2004 Audit Letter'').  
26Letter from Hillary S. DeNigro, Deputy Chief, Investigations 
and Hearings Division, Enforcement Bureau, FCC, to Sue Bouchard, 
Telecom Management, Inc., dated November 18, 2004 (``November 18, 
2004 LOI'').
27See TMI December 20, 2004 Letter.  On December 8, 2004, TMI 
requested an extension of time to file its response to the LOI.  
The Division granted TMI's request on December 9, 2004 by 
extending the deadline to December 20, 2004.  See Letter from 
Hillary S. DeNigro, Deputy Chief, Investigations and Hearings 
Division, Enforcement Bureau, FCC, to Leon Nowalsky, Counsel for 
TMI, Nowalsky, Bronston & Gothard, APLLC, dated December 9, 2004.
28See Letter from Leon L. Nowalsky, Counsel for TMI, Nowalsky, 
Bronston & Gothard, APLLC, to Hillary S. DeNigro, Deputy Chief, 
Investigations and Hearings Division, Enforcement Bureau, FCC, 
dated January 17, 2005 (``TMI January 17, 2005 Supplemental 
Letter'').
29The record shows that TMI filed its registration in April 2004 
and back-filed Worksheets in December 2004 only after we 
initiated our audit inquiry.  See TMI December 20, 2004 Letter.
3047 U.S.C. § 503(b)(1)(B); 47 C.F.R. § 1.80(a)(1).  Section 
312(f)(1) of the Act defines willful as ``the conscious and 
deliberate commission or omission of [any] act, irrespective of 
any intent to violate'' the law.  47 U.S.C. § 312(f)(1).  The 
legislative history to section 312(f)(1) of the Act clarifies 
that this definition of willful applies to both sections 312 and 
503(b) of the Act, H.R. Rep. No. 97-765, 97th Cong. 2d Sess. 51 
(1982), and the Commission has so interpreted the term in the 
section 503(b) context.  See, e.g., Application for Review of 
Southern California Broadcasting Co., Memorandum Opinion and 
Order, 6 FCC Rcd 4387, 4388 (1991) (``Southern California 
Broadcasting Co.'').  The Commission may also assess a forfeiture 
for violations that are merely repeated, and not willful.  See, 
e.g., Callais Cablevision, Inc., Grand Isle, Louisiana, Notice of 
Apparent Liability for Monetary Forfeiture, 16 FCC Rcd 1359 
(2001) (issuing a Notice of Apparent Liability for, inter alia, a 
cable television operator's repeated signal leakage).  
``Repeated'' means that the act was committed or omitted more 
than once, or lasts more than one day.  Callais Cablevision, 
Inc., 16 FCC Rcd at 1362, ¶ 9; Southern California Broadcasting 
Co., 6 FCC Rcd at 4388, ¶ 5.
3147 U.S.C. § 503(b); 47 C.F.R. § 1.80(f).
32See, e.g., SBC Communications, Inc., Forfeiture Order, 17 FCC 
Rcd 7589, 7591, ¶ 4 (2002) (forfeiture paid).
3347 U.S.C. § 254(d).
3447 C.F.R. §§ 54.706(a), 1.1154, and 1.1157(b)(1).
3547 U.S.C. § 254(d).
3647 C.F.R. §§ 54.706(a), 1.1154, and 1.1157(b)(1).
3747 U.S.C. § 254(d); 47 C.F.R. § 54.706(c).  
3847 C.F.R. § 54.706(c).  
39See 47 C.F.R. § 54.706(a)(16).  
40TMI December 20, 2004 Letter, Response to Inquiry 4.
41See TMI December 20, 2004 Letter, Response to Inquiry 10, 
attaching USAC's November 2004 billing to TMI, which shows TMI's 
full payment of its first (October 2004) USF billing.  We note 
also that TMI began making USF payments only after receiving the 
Bureau's letters and it still owes a significant unpaid past due 
balance.  See March 30, 2004 Audit Letter; June 18, 2004 Audit 
Letter; November 18, 2004 LOI.  The Commission has repeatedly 
stated that post-investigative corrective measures to address a 
violation do not eliminate a licensee's responsibility for the 
period during which the violation occurred.  See AT&T Wireless 
Services, Inc., Forfeiture Order, 17 FCC Rcd 21866, 21870-71 
(2002); America's Tele-Network Corp., Order of Forfeiture, 16 FCC 
Rcd 22350, 22355, ¶ 15 (2001); Coleman Enters., Inc. d/b/a/ Local 
Long Distance, Inc., Order of Forfeiture, 15 FCC Rcd 24385, 
24388, ¶ 8 (2000).
42Globcom, Inc., 18 FCC Rcd at 19903 ¶ 26.
4347 U.S.C. § 159(a)(1); 47 C.F.R. §§ 1.1154, 1.1157.  Payments 
of standard regulatory fees applicable to common carrier services 
must be filed in full on an annual basis.  Id. § 1.1157(b)(1).
44See 47 C.F.R. §§ 1.1154, 1.1157(b)(1).  Regulatory fees are 
paid in arrears for the previous calendar year.  Thus, TMI failed 
to pay any regulatory fees in 2003, and made an untimely payment 
on December 28, 2004 for fiscal year 2004.
45TMI's regulatory fees were due on August 19, 2004.  See FCC 
Form 159-W (Interstate Telephone Service Provider Regulatory Fee 
Bill); http://www.fcc.gov/fees/regfees.html.  On December 28, 
2004, TMI made an FCC regulatory fee payment of $5,339.24.  See 
TMI January 17, 2005 Supplemental Letter.  
4647 U.S.C. § 503(b)(1)(B); 47 C.F.R. § 1.80(a)(2).
4747 U.S.C. § 503(b)(2)(B); see also 47 C.F.R. § 1.80(b)(2).  The 
Commission recently amended its rules to increase the maximum 
penalties to account for inflation since the last adjustment of 
the penalty rates.  See Amendment of Section 1.80(b) of the 
Commission's Rules and Adjustment of Forfeiture Maxima to Reflect 
Inflation, Order, 15 FCC Rcd 18221 (2000).  However, the new 
rates apply to violations that occur or continue after September 
7, 2004.  See Amendment of Section 1.80(b) of the Commission's 
Rules and Adjustment of Forfeiture Maxima to Reflect Inflation, 
Order, 19 FCC Rcd 10945 (2004).
4847 U.S.C. § 503(b)(2)(D); see also Forfeiture Policy Statement, 
12 FCC Rcd at 17100, ¶ 27; 47 C.F.R. § 1.80(b).
4947 U.S.C. § 503(b)(6)(B); see also 47 C.F.R. § 1.80(c)(3).
50See, e.g., Globcom, Inc., 18 FCC Rcd at 19903; Roadrunner 
Transp., Inc., Forfeiture Order, 15 FCC Rcd 9669, 9671 (2000); 
Liab. of E. Broad. Corp., Memorandum Opinion and Order, 10 F.C.C. 
2d 37 (1967).
51See 47 U.S.C. § 254(d).
52See Globcom, Inc., 18 FCC Rcd at 19903-19904, ¶¶ 25-27.
53As noted above, TMI made no universal service payments until 
November 2004.  Thus, TMI's failure to make required universal 
service contributions within the one-year statute of limitations 
occurred in August, September, and October 2004.  
54See, e.g., Globcom, Inc., 18 FCC Rcd at 19904.
55See Teletronics, Inc., Notice of Apparent Liability for 
Forfeiture and Order, FCC 05-146, ¶ 36 (rel. Jul. 25, 2005); 
Carrera Communications, LP, Notice of Apparent Liability for 
Forfeiture and Order, FCC 05-147, ¶ 30 (rel. Jul. 25, 2005).
56Forfeiture Policy Statement, 12 FCC Rcd at 17099; see also 47 
C.F.R. § 1.80(b)(4).
57See Business Options, Inc., Consent Decree, 19 FCC Rcd 2916 
(2003); NOS Communications, Inc., Affinity Network Incorporated 
and NOSVA Limited Partnership, Consent Decree, 2003 WL 22439710 
(2003).
58See supra n. 15.
59See 47 C.F.R. § 1.80(f)(3).
60See 47 C.F.R. § 1.1914.