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                                   Before the

                       Federal Communications Commission

                             Washington, D.C. 20554

     In the Matter of                    )   File No. EB-06-TC-3424      
     PhoneCo, LP                         )   NAL/Acct. No. 200732170046  
     Apparent Liability for Forfeiture   )   FRN: 0008843955             

                                FORFEITURE ORDER

   Adopted: August 10, 2007   Released: August 10, 2007

   By the Enforcement Bureau:


   1. In this Forfeiture Order ("Order"), we issue a monetary forfeiture in
   the amount of four thousand dollars ($4,000) against PhoneCo, LP
   ("PhoneCo" or "Company"). PhoneCo violated a Commission order by failing
   to respond to the directive of the Enforcement Bureau ("Bureau") to
   provide certain information and documents. PhoneCo acted in willful or
   repeated violation of Section 503(b) of the Communications Act of 1934, as
   amended, ("Act") and Section 1.80 of the Commission's rules ("Rules").

   2. On March 30, 2007, the Bureau issued to PhoneCo a Notice of Apparent
   Liability for Forfeiture ("NAL") proposing a forfeiture in the amount of
   four thousand dollars ($4,000) based on PhoneCo's apparent violation of
   the Bureau's directive. The NAL gave PhoneCo the option of paying the
   proposed forfeiture or of filing a response to the NAL stating why the
   proposed forfeiture should either not be assessed or should be reduced.
   The NAL was sent by certified mail to PhoneCo's last known address.
   PhoneCo filed a response to the NAL on June 27, 2007. Based on the
   information contained therein, we affirm this forfeiture.


   3. The 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. Data brokers have also advertised
   the availability of call information that relates to certain landline toll

   4. As part of our inquiry into these issues, the Bureau sent Letters of
   Inquiry ("LOIs") to several carriers, including PhoneCo, directing them to
   submit their certifications for the previous five (5) years prepared in
   compliance with section 64.2009(e) of the Commission's rules.  PhoneCo did
   not respond to the LOI. Accordingly, on March 30, 2007, the Bureau issued
   the NAL  to PhoneCo for its failure to respond to the directive of the

   5. On June 27, 2007, PhoneCo submitted a response to the NAL, which
   explains  the Company's reasons for failing to respond to the LOI. 
   PhoneCo states that it did realize that it had failed to respond to the
   Bureau's request because it was in the process of changing legal counsel. 
   Specifically, it states that, "[d]ue to the transition, inadvertence
   and/or mistake of the [former] counsel in Austin, who handled the CNPI
   [sic] filings, it was not realized that PhoneCo, L.P.'s [LOI response] had
   not been filed . . . ."  PhoneCo  requests that the NAL be reduced or
   canceled, because the failure to timely respond was the result of a
   mistake, and not willful or intentional behavior.


   6. 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. The
   Commission may assess this penalty if it determines that the carrier's
   noncompliance is "willful or repeated." For a violation to be willful, it
   need not be intentional. 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." 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.

   7. 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.

   8. In this case, PhoneCo argues that it had no knowledge of its failure to
   respond to the Bureau's LOI. It asserts that it relied on, and evidently
   believed, that its (then) legal counsel, made this filing. However, said
   counsel did not file a response and did not inform the Company of this
   failure. PhoneCo also explains that these events occurred during its
   transition to new legal counsel. Thus, the Company asserts that the
   violation was due to mistake, and therefore, not a willful or intentional
   act. We find no merit in this explanation. Allowing a licensee to violate
   our rules because of a misplaced trust in the competency of legal counsel
   or because of the mismanagement of its affairs during a period of
   transition does not serve the public interest. Thus, after fully
   considering the facts and circumstances described herein, we believe the
   forfeiture of $4,000 is warranted in this case.

   9. Accordingly, IT IS ORDERED THAT, pursuant to Section 503(b) of the Act,
   and Sections 0.111, 0.311 and 180(f)(4) of the Rules, PhoneCo, LP IS
   LIABLE FOR A MONETARY FORFEITURE  in the amount of four thousand dollars
   ($4,000) for willfully and repeatedly violating Section 503 of the Act and
   Section 1.80 of the Rules within thirty (30) days of the release of this
   Order. If the forfeiture is not paid within the period specified, the case
   may be referred to the Department of Justice for collection pursuant to
   Section 504(a) of the Act.

   10. Payment of the forfeiture must be made by check or similar instrument,
   payable to the order of the Federal Communication 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, Pennsylvania 15251. Payment by overnight mail may be sent to
   Mellon Client Service Center, 500 Ross Street, Room 670, Pittsburgh, PA
   15262-0001, Attn.: FCC Module Supervisor. Payment by wire transfer may be
   made to: ABA Number 043000261, receiving bank Mellon Bank, and account
   number 911-6229. Please include your NAL/Acct. No. with your wire transfer
   remittance. Requests for full payment under an installment plan should be
   sent to: Chief, Revenue and Receivables Operations Group, 445 12th Street,
   S.W., Washington, D.C. 20554.

   5. IT IS FURTHER ORDERED that a copy of the Forfeiture Order  shall be
   sent by first class mail and certified mail return requested to PhoneCo,
   LP, at its last known address, 7900 John Carpenter Freeway, Dallas, Texas


   Kris A. Monteith

   Chief, Enforcement Bureau

   47 U.S.C. S: 503(b).

   47 C.F.R. S: 1.80.

   PhoneCo LP, Notice of Apparent Liability for Forfeiture, 22 FCC Rcd 6318
   (2007) ("NAL").

   See Letter from Steven R. Shaver, Counsel for PhoneCo, LP, to Marcy
   Greene, Deputy Division Chief, Telecommunications Consumers Division,
   Enforcement Bureau, (filed June 27, 2007) ("NAL Response").

   See, e.g.

   See id.

   See LOI from Marcy Greene, Deputy Division Chief, Telecommunications
   Division, Enforcement Bureau, to Peni Barfield, CEO, PhoneCo, LP (sent
   December 26, 2006) ("LOI").

   See NAL Response at 1-2.

   Id. at 1.

   Id. PhoneCo explains that both of its corporate sisters, Accutel of Texas
   and Revolution Communications Ltd., timely filed their CPNI
   certifications. Id.

   Id. at 2.

   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. S:
   503(b)(2)(B). See Amendment of Section 1.80 of the Commission's Rules and
   Adjustment of Forfeiture Maxima to Reflect Inflation, Order, 15 FCC Rcd
   18221 (2000); Amendment of Section 1.80 of the Commission's Rules and
   Adjustment of Forfeiture Maxima to Reflect Inflation, Order, 19 FCC Rcd
   10945 (2004) (increasing maximum forfeiture amounts to account for

   47 U.S.C. S: 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. S: 503(b)(4)(A). Here, as described above, AT&T's
   actions were willful as it apparently failed to prepare the required
   compliance certification.

   Southern California Broadcasting Co., Memorandum Opinion and Order, 6 FCC
   Rcd 4387 (1991).

   See 47 U.S.C. S: 503(b)(2)(D); see also The Commission's Forfeiture Policy
   Statement and Amendment of Section 1.80 of the Commission's Rules, Report
   and Order, 12 FCC Rcd 17087 (1997) ("Forfeiture Policy Statement"); recon.
   denied, 15 FCC Rcd 303 (1999).

   Forfeiture Policy Statement, 12 FCC Rcd at 17098-99, P: 22.

   See, e.g., In the matter of Liability of Triad Broadcasting Company, Inc.,
   Licensee of Radio Station WSEZ (FM) Winston-Salem, North Carolina for
   Forfeiture, Memorandum Opinion and Order, 96 FCC 2d 1235 (1984) (citations

   47 U.S.C. S: 503(b)(4)(A).

   47 U.S.C. S: 503(b).

   47 C.F.R. S:S: 0.111, 0.311, 1.80(f)(4).

   47 U.S.C. S: 504(a).

   (...continued from previous page)


   Federal Communications Commission DA 07-3583


   Federal Communications Commission DA 07-3583