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                                   Before the

                       Federal Communications Commission

                             Washington, D.C. 20554


                                             )                               
                                                                             
                                             )                               
                                                                             
     In the Matter of                        )                               
                                                 File No. EB-08-IH-5303      
     RB Communications, Inc., d/b/a          )                               
     Starfone                                    NAL/Acct. No. 201232080018  
                                             )                               
     Apparent Liability for Forfeiture           FRN 0012951612              
                                             )                               
                                                                             
                                             )                               
                                                                             
                                             )                               


             NOTICE OF APPARENT LIABILITY FOR FORFEITURE AND ORDER

   Adopted: April 13, 2012 Released: April 16, 2012

   By the Commission:

   I. INTRODUCTION

    1. In this Notice of Apparent Liability for Forfeiture and Order (NAL),
       we find that RB Communications, Inc., d/b/a Starfone, apparently
       violated Section 214 of the Communications Act of 1934, as amended
       (the "Act"), and Sections 1.1154, 1.1157(b)(1), 63.18,
       64.604(c)(5)(iii)(A), and 64.1195 of the Commission's rules, by
       willfully and repeatedly failing to: (1) apply for and obtain
       authorization from the Commission to provide international
       telecommunications service; (2) register with the Commission; (3)
       contribute to the Telecommunications Relay Service (TRS) Fund; and (4)
       pay regulatory fees to the Commission. Based on our review of the
       facts and circumstances surrounding this matter, and for the reasons
       discussed below, we find that Starfone is apparently liable for a
       total forfeiture of $408,668.

   II. BACKGROUND

    2. Section 214(a) of the Act prohibits any carrier from constructing,
       extending, acquiring, or operating any line, and from engaging in
       transmission through any such line, without first obtaining a
       certificate of authorization from the Commission. While the Commission
       has granted "blanket" authority to carriers providing domestic
       service, meaning that such carriers need not apply to the Commission
       for such authority before providing domestic service, the Commission
       has not done the same for providers of international
       telecommunications services. Instead, a carrier must seek and obtain
       Section 214 approval from the Commission prior to providing such
       services. The Commission has explained that the international Section
       214 review process enables the Commission to review applications for
       risks to competition, particularly in situations where the applicant
       has an affiliation with a foreign carrier with market power on the
       foreign end of the route that may be able to leverage that market
       power to discriminate against U.S. competitors to the detriment of
       U.S. consumers. The review process also includes consultation with
       Executive Branch agencies regarding national security, law
       enforcement, foreign policy and trade concerns that may be unique to
       the provision of international service.

    3. Section 63.18 of the Commission's rules requires that any carrier that
       seeks Section 214 authority "for the provision of common carrier
       communications services between the United States, its territories or
       possessions, and a foreign point shall request such authority by
       formal application." Through this process the applicant provides the
       Commission with, among other things, contact information, ownership
       information, information on any affiliations it may have with foreign
       carriers, certification that it will comply with Commission rules, and
       certification that the applicant is not subject to denial of Federal
       benefits pursuant to the Anti-Drug Abuse Act of 1988. Section
       63.18(e)(2) establishes specific requirements for parties "applying
       for authority to resell the international services of authorized
       common carriers," and Section 63.23 of the rules, in turn, identifies
       the conditions that apply to "carriers authorized to resell the
       international services of other authorized carriers."

    4. Congress has charged the Commission to establish, administer, and
       maintain various telecommunications regulatory programs, 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 to provide telecommunications service, do not engage in
       fraud, and do not evade oversight. Section 64.1195 of the Commission's
       rules requires that upon entry or anticipated entry into interstate
       telecommunications markets, telecommunications carriers register by
       submitting information on FCC Form 499-A, also known as the annual
       Telecommunications Reporting Worksheet (annual Worksheet or Form
       499-A).

    5. Section 225(b)(1) of the Act, which codifies Title IV of the Americans
       with Disabilities Act of 1990, directs the Commission to "ensure that
       interstate and intrastate telecommunications relay services are
       available, to the extent possible and in the most efficient manner, to
       hearing-impaired and speech-impaired individuals in the United
       States." To that end, the Commission established the TRS Fund to
       reimburse TRS providers for the costs of providing interstate
       telecommunications relay services. Pursuant to Section
       64.604(c)(5)(iii)(A) of the Commission's rules, every provider of
       interstate or international telecommunications services must
       contribute to the TRS Fund based upon its end-user revenues.

    6. The Commission has established specific procedures for administration
       of the TRS Fund and other associated federal regulatory programs.
       These include the requirement that each telecommunications provider
       file, pursuant to Section 54.711(a) of the Commission's rules,
       accurate company-specific revenue data on Form 499-A annually. The
       information reported on Form 499-A is used to determine the
       telecommunications provider's payment obligations to the TRS Fund and
       other regulatory programs. These periodic filings trigger a
       determination of liability, if any, and subsequent billing and
       collection by the entities that administer the regulatory programs.
       Providers must timely pay their contribution invoices, and the
       Commission's rules explicitly warn contributors that failure to file
       forms or submit payments potentially subjects them to enforcement
       action.

    7. Pursuant to Section 9(a)(1) of the Act, Section 1.1151 of the
       Commission's rules requires providers of interstate telecommunications
       services and other providers to pay regulatory fees to the Commission
       to cover the costs of certain regulatory activities. In particular,
       Sections 1.1154 and 1.1157 of the Commission's rules require that
       interstate telecommunications carriers pay regulatory fees on the
       basis of their interstate and international end-user revenues. Such
       fees must be paid on an annual basis, and failure to do so subjects a
       carrier to late payment penalties, as well as possible revocation of
       its operating authority.

    8. RB Communications, Inc. is a California corporation that does business
       under the trade name "Starfone." Beginning in 2003, Starfone has
       resold interstate and international telecommunications services to end
       users. On October 6, 2008, the Universal Service Administrative
       Company (USAC) referred Starfone to the Enforcement Bureau (Bureau)
       for potential enforcement action related to its apparent failures to
       register and to comply with other regulatory requirements.

    9. On March 9, 2009, the Bureau issued a letter of inquiry (LOI) to
       Starfone seeking information about its compliance with the
       Commission's rules governing, among other things, the provision of
       international telecommunications service and contributions to the TRS
       Fund. The Bureau issued a further letter of inquiry to Starfone on
       September 4, 2009.

   10. In its response to the LOI, Starfone admitted that it had not
       previously applied for an international Section 214 authorization.
       Starfone also admitted that it had failed to timely register with the
       Commission, and that it had never contributed to the TRS Fund.

   11. On July 23, 2009, USAC received for the first time a signed
       "registration-only" Form 499-A from Starfone. On February 1, 2010,
       Starfone submitted an application for international Section 214
       authority, which was granted on March 5, 2010. On April 1, 2010,
       Starfone provided annual revenue data to USAC for the first time,
       reporting its calendar year 2009 revenue on Form 499-A. It made a
       timely 499-A filing in April of 2011. In December 2011, Starfone filed
       the Forms 499-A that had been due in 2007, 2008, and 2009. Starfone
       made no payments to the TRS Administrator for 2007, 2008, or 2009.
       Further, with the exception of a small payment made in 2011, Starfone
       has not paid any regulatory fees due to the Commission for the period
       2007 to 2011.

   III. DISCUSSION

   12. Under Section 503(b)(1) 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. 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. The legislative
       history to Section 312(f)(1) clarifies that this definition of willful
       applies to both Sections 312 and 503(b) of the Act, and the Commission
       has so interpreted the term in the Section 503(b) context. The
       Commission may also assess a forfeiture for violations that are merely
       repeated, and not willful.  "Repeated" means that the act was
       committed or omitted more than once, or lasts more than one day. 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. The Commission will then issue a
       forfeiture if it finds, based on the evidence, that the person has
       violated the Act, a rule, or a Commission order. As set forth below,
       we conclude that Starfone is apparently liable for forfeiture for its
       apparent willful and repeated violations of Section 214 of the Act and
       Sections 1.1154, 1.1157(b)(1), 63.18, 64.604(c)(5)(iii)(A), and
       64.1195 of the Commission's rules.

   13. The fundamental issues in this case are whether Starfone apparently
       violated the Act and the Commission's rules by willfully or repeatedly
       failing to apply for and obtain authorization from the Commission to
       provide international telecommunications service, register with the
       Commission, contribute to the TRS Fund, and pay regulatory fees to the
       Commission. We answer these questions in the affirmative. Based on the
       facts and circumstances before us, we therefore conclude that Starfone
       is apparently liable for a forfeiture of $408,668.

    A. Starfone Apparently Failed to Obtain an International Section 214
       Authorization Before Providing International Telecommunications
       Service

   14. We find that Starfone provided international telecommunications
       service without an international Section 214 authorization from
       November 1, 2003 until March 5, 2010. In its LOI Response, Starfone
       stated that it began providing international telecommunications
       service on November 1, 2003. Starfone did not apply for international
       Section 214 authority until February 3, 2010, nearly a year after
       receiving a letter of inquiry from the Bureau, and was not granted
       such authority until March 5, 2010. Starfone stated in the LOI
       Response, and again in its Section 214 application, that it had not
       previously been granted international Section 214 authority. Thus,
       Starfone apparently provided international telecommunications service
       without Commission-granted international Section 214 authority from
       November 1, 2003 to March 5, 2010. We therefore conclude based on a
       preponderance of the evidence that Starfone has apparently willfully
       and repeatedly violated Section 214 of the Act and Section 63.18 of
       the Commission's rules.

    B. Starfone Apparently Failed to Register with the Commission

   15. We conclude that Starfone has apparently violated Section 64.1195(a)
       of our rules by failing to register with the Commission from the time
       it began providing interstate telecommunications services until July
       23, 2009. Starfone's failure to register constitutes an apparent
       violation of a vital Commission rule. Section 64.1195(a) unambiguously
       requires that all carriers that provide, or plan to provide,
       interstate telecommunications services register with the Commission by
       submitting specified information on Form 499-A. Although Starfone had
       provided interstate telecommunications services for several years, it
       failed to register in accordance with Section 64.1195(a) until July
       23, 2009. As a result of its misconduct, Starfone operated for a
       significant period of time without participation in any of the
       programs tied to registration. As an interstate telecommunications
       carrier, Starfone had a clear and affirmative duty to satisfy this
       federal obligation.

   16. We view Starfone's apparent failure to register for a significant
       period as a serious dereliction of its responsibilities under the Act
       and our rules. A carrier's compliance with the Commission's
       registration requirement is critical to the administration of the TRS
       and other programs, and to fulfilling Congress' objectives in Section
       225(b)(1) of the Act, because registration identifies the company to
       the various program administrators and brings the company within the
       purview and oversight of those administrators. If a carrier never
       identifies itself as a telecommunications provider by properly
       registering under the Commission's rules, then neither the Commission
       nor the various program administrators can ascertain whether that
       carrier has fulfilled its regulatory obligations, including the
       requirement that carriers file Worksheets and contribute to TRS and
       other regulatory programs. Moreover, the program administrators have
       no basis upon which to invoice the carrier for contributions. A
       telecommunications carrier that fails to register thus can operate
       outside of the Commission's oversight and evade its federal
       obligations to contribute toward the vital programs.

   17. The impact of a carrier's failure to register is no less severe where,
       as here, that carrier ultimately registers with the Commission.
       Although Starfone registered on July 23, 2009, Starfone delayed its
       registration for a substantial period of time and did not complete its
       registration until several months after receiving a letter of inquiry
       from the Bureau. 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. Based on a preponderance of the evidence,
       therefore, we find that Starfone apparently has violated Section
       64.1195(a) of the Commission's rules by willfully and repeatedly
       failing to register until July 23, 2009.

    C. Starfone Apparently Failed to Make TRS Fund Contributions

   18. As a provider of interstate and international telecommunications
       services, Starfone was obligated to contribute to the TRS Fund on the
       basis of its interstate and international end-user telecommunications
       revenues reported on its annual Worksheet. A carrier's contribution to
       the TRS Fund is based upon its revenues for the prior calendar year
       and a contribution factor determined annually by the Commission.
       Subject carriers must make TRS contributions on an annual basis, with
       certain exceptions that are not applicable to Starfone. Records of the
       TRS administrators indicate that Starfone made no payment towards its
       TRS Fund obligations prior to 2010. We therefore conclude, based on a
       preponderance of the evidence, that Starfone has apparently violated
       Section 64.604(c)(5)(iii)(A) of the Commission's rules by willfully
       and repeatedly failing, up to the date of this NAL, to make all
       required TRS contributions due to the TRS Administrator in 2007, 2008,
       and 2009.

    D. Starfone Apparently Failed to Pay its Regulatory Fees

   19. As an interstate telecommunications service provider, Starfone is
       required to pay regulatory fees on the basis of its interstate and
       international end-user revenues as reported on its Form 499-A. The
       Commission's records indicate that, with the exception of a very small
       payment made in September 2011, Starfone has failed to make any
       regulatory fee payments to date. We therefore conclude, based on a
       preponderance of the evidence, that Starfone apparently violated
       Sections 1.1154 and 1.1157(b)(1) of the Commission's rules by
       willfully and repeatedly failing to pay regulatory fees due to the
       Commission for each year from 2007 to 2011.

    E. Proposed Forfeiture Amount

   20. Section 503(b)(1) of the Act provides that any person who 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. Section 503(b)(2)(B) of the
       Act authorizes the Commission to assess a forfeiture of up to $150,000
       for each violation or each day of a continuing violation by a common
       carrier, up to a statutory maximum of $1,500,000 for a single act or
       failure to act. In determining the appropriate forfeiture amount, we
       consider the factors enumerated in Section 503(b)(2)(E) 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," as well as our forfeiture
       guidelines.

   21. We conclude that Starfone apparently failed to obtain an international
       Section 214 authorization from the Commission prior to providing
       international telecommunications service. Starfone apparently operated
       as an international telecommunications service provider from November
       2003 until March 5, 2010 without authorization from the Commission. We
       therefore find that this apparent violation of the Act and the
       Commission's rules was both willful and repeated. Given the
       unambiguous language of the Act, the Commission's rules and decisions,
       and even the Commission's website, it should have been apparent to
       Starfone that it was required to obtain Section 214 authority from the
       Commission to provide international telecommunications service.

   22. In light of the clear statutory and Commission requirements, we find
       that Starfone's failure to obtain Section 214 authority from the
       Commission prior to providing international telecommunications service
       was also egregious. Just as a telecommunications carrier that fails to
       register can operate outside of the Commission's oversight and evade
       its federal obligations to contribute toward the vital programs linked
       to registration, international telecommunications carriers that fail
       to obtain Section 214 authority may endanger important public interest
       considerations involving national security, law enforcement, foreign
       policy and trade policy. We also find that a proposed forfeiture must
       be large enough to have a deterrent effect on companies with gross
       revenues commensurate with those of Starfone. Pursuant to the
       Commission's mandate from Congress to consider "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," we find, consistent with prior precedent for entities
       failing to receive prior authorization from the International Bureau,
       that a proposed forfeiture of $100,000 is warranted for Starfone's
       apparent willful and repeated failure to obtain Section 214 authority
       from the Commission prior to providing international
       telecommunications service.

   23. Starfone failed to register with the Commission until July 23, 2009,
       in apparent willful and repeated violation of Section 64.1195(a) of
       our rules. Registration with the Commission through filing of
       Telecommunications Reporting Worksheets is fundamental to the
       implementation of our central repository of carriers and to the
       administration of multiple statutorily derived programs - including
       the TRS Fund. Where, as here, a carrier ignores its obligations by
       wholly failing to register for a long period - thereby affecting the
       time and manner in which these important federal programs are funded -
       it undermines the programs and thwarts the purposes for which Congress
       and the Commission established them.

   24. We have previously established $100,000 as the base forfeiture for a
       carrier's failure to register with the Commission. We explained that
       "[t]his egregious behavior strikes at the core of our ability to
       implement and enforce the Act and our rules effectively, thus
       warranting a substantial forfeiture." A carrier that fails to register
       hampers "efficient and effective Commission enforcement by delaying
       detection of, and action against, its behavior . . . [and] imposes a
       substantial burden on the Commission, which can only identify such
       carriers through compliance review programs that require significant
       amounts of staff time and resources." Taking into account all of the
       factors enumerated in Section 503(b)(2)(E) of the Act, we conclude
       that this same reasoning accurately describes the impact of Starfone's
       misconduct, and that a proposed forfeiture of $100,000 is therefore
       warranted.

   25. We also find that Starfone has failed to make TRS contributions for
       2007 to 2009. Where a provider fails to satisfy its TRS obligations
       for an extended period of time, it thwarts the purpose for which
       Congress established Section 225(b)(1) of the Act and its implementing
       regulations - to ensure that "telecommunications relay services are
       available, to the extent possible and in the most efficient manner, to
       hearing-impaired and speech-impaired individuals in the United
       States." We have previously stated that nonpayment of TRS and other
       contributions constitute continuing violations because they are cured
       only by payment of all monies owed. To effectively deter companies
       like Starfone from violating our rules governing payment into the TRS
       and other programs, our forfeiture calculations will reflect not only
       the violations that began within the last twelve months, but all such
       continuing violations.

   26. The Commission has generally established a base forfeiture amount of
       $10,000 for each instance in which a contributor fails to make
       required TRS contributions. Thus, we propose a $30,000 forfeiture for
       Starfone's failure to pay its TRS Fund contributions for each year
       from 2007 to 2009. In the past, we have also calculated upward
       adjustments to forfeitures for failure to make TRS payments based on a
       percentage of one half of the company's unpaid balance. As described
       above, Starfone currently owes $257,336 to the TRS Fund for 2007 to
       2009. Thus, under this formula, we propose an upward adjustment of
       $128,668 for Starfone's apparent nonpayment violations, taking into
       account all the factors enumerated in Section 503(b)(2)(E) of the Act.
       Accordingly, we find Starfone liable for a total proposed forfeiture
       of $158,668 for its apparent willful and repeated failure to make
       contributions into the TRS Fund.

   27. Finally, we find that, with the exception of a small payment in 2011,
       Starfone has apparently failed to make regulatory fee payments due to
       the Commission on the basis of its actual interstate and international
       end-user telecommunications revenues for each year from 2007 to 2011.
       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. As with the failure to make TRS contributions, failures to
       make regulatory fee payments are continuing violations until they are
       cured by the payment of all monies owed. The Commission has
       established a base forfeiture amount of $10,000 for failure to make
       required regulatory fee payments. Therefore, we find Starfone is
       apparently liable for a forfeiture of $50,000 for its willful and
       repeated failure to make regulatory fee payments from 2007 to 2011.

   IV. CONCLUSION

   28. In light of the seriousness, duration, and scope of the apparent
       violations, we propose a forfeiture in the amount of $408,668 for
       Starfone's failure to apply for and obtain authorization from the
       Commission to provide international telecommunications service,
       register with the Commission, contribute to the TRS Fund, and make
       regulatory fee payments. We caution that additional violations of the
       Act or the Commission's rules could subject Starfone to further
       enforcement action. Such action could take the form of higher monetary
       forfeitures and/or possible revocation of Starfone's operating
       authority, including disqualification of Starfone's principals from
       the provision of any interstate or international common carrier
       services without the prior consent of the Commission.

   V. ORDERING CLAUSES

   29. ACCORDINGLY, IT IS ORDERED THAT, pursuant to Section 503(b) of the
       Communications Act of 1934, as amended, 47 U.S.C. S: 503(b), and
       Section 1.80 of the Commission's rules, 47 C.F.R. S: 1.80, that RB
       Communications, Inc. is hereby NOTIFIED of its APPARENT LIABILITY FOR
       A FORFEITURE in the amount of  $408,668 for willfully and repeatedly
       violating the Act and the Commission's rules.

   30. 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 FOR FORFEITURE AND ORDER, RB
       Communications, Inc. SHALL PAY the full amount of the proposed
       forfeiture or SHALL FILE a written statement seeking reduction or
       cancellation of the proposed forfeiture.

   31. IT IS FURTHER ORDERED THAT RB Communications, Inc. shall submit within
       thirty days of the release date of this NOTICE OF APPARENT LIABILITY
       FOR FORFEITURE AND ORDER, a report supported by a sworn statement or
       declaration under penalty of perjury of a corporate officer setting
       forth in detail its plan to come into compliance with the reporting
       and payment obligations discussed herein. The report must be mailed to
       Theresa Z. Cavanaugh, Acting Chief, Investigations and Hearings
       Division, Enforcement Bureau, Federal Communications Commission, 445
       12th Street, S.W., Suite 4-C330, Washington, D.C. 20554. RB
       Communications, Inc. shall also transmit a copy of the report via
       email to terry.cavanaugh@fcc.gov.

   32. 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 979088, St. Louis, MO 63197-9000.
       Payment by overnight mail may be sent to U.S. Bank - Government
       Lockbox #979088, SL-MO-C2-GL, 1005 Convention Plaza, St. Louis, MO
       63101. Payments by wire transfer may be made to ABA Number 021030004,
       receiving bank TREAS NYC, and account number 27000001. An FCC Form 159
       (Remittance Advice) must be submitted with the payment.  When
       completing the FCC Form 159, enter the NAL/Account number in block
       number 23A (call sign/other ID), and enter the letters "FORF" in block
       number 24A (payment type code). RB Communications, Inc. will also send
       electronic notification within forty-eight (48) hours of the date said
       payment is made to margaret.dailey@fcc.gov.

   33. The response, if any, to this NOTICE OF APPARENT LIABILITY FOR
       FORFEITURE AND ORDER must be mailed to Theresa Z. Cavanaugh, Acting
       Chief, Investigations and Hearings Division, Enforcement Bureau,
       Federal Communications Commission, 445 12th Street, S.W., Room 4-C330,
       Washington, D.C. 20554 and must include the NAL/Acct. No. referenced
       above.

   34. 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.

   35. Requests for payment of the full amount of this Notice of Apparent
       Liability for Forfeiture and Order under an installment plan should be
       sent to: Chief Financial Officer - Financial Operations, Federal
       Communications Commission, 445 12th Street, S.W., Room 1-A625,
       Washington, D.C. 20554. For answers to questions, please contact the
       Financial Operations Group Help Desk at 1-877-480-3201 or Email:
       ARINQUIRIES@fcc.gov.

   36. IT IS FURTHER ORDERED that a copy of this NOTICE OF APPARENT LIABILITY
       FOR FORFEITURE shall be sent by certified mail, return receipt
       requested, to RB Communications, Inc., Renzo Biogeti, Owner, 444 West
       Ocean Blvd., Suite 1515, Long Beach, CA 90802.

   FEDERAL COMMUNICATIONS COMMISSION

   Marlene H. Dortch

   Secretary

   47 U.S.C. S: 214.

   47 C.F.R. S:S: 1.1154, 1.1157(b)(1), 63.18, 64.604(c)(5)(iii)(A), 64.1195.

   47 U.S.C. S: 214(a).

   47 C.F.R. S: 63.01(a) (authorizing "[a]ny party that would be a domestic
   interstate communications common carrier . . . to provide domestic,
   interstate services to any domestic point and to construct or operate any
   domestic transmission line as long as it obtains all necessary
   authorizations from the Commission for use of radio frequencies").

   Implementation of Section 402(b)(2)(A) of the Telecomm. Act of 1996,
   Report and Order in CC Docket No. 97-11, Second Memorandum Opinion and
   Order in AAD File No. 98-43, 14 FCC Rcd 11364, 11365-66, para. 2 & n.8
   (1999) (grant of blanket authority is only for domestic services and does
   not extend to the provision of international services).

   47 C.F.R. S: 63.18; see also 47 U.S.C. S: 214(a).

   See 1998 Biennial Regulatory Review - Review of International Common
   Carrier Regulations, Report and Order, 14 FCC Rcd 4909,  4914-16, paras.
   14-16  (1999) (1998 International Biennial Review Order); Personal
   Communications Industry Ass'n's Broadband Personal Communications Services
   Alliance's Petition for Forbearance for Broadband Personal Communications
   Services, Memorandum Opinion and Order and Notice of Proposed Rulemaking,
   13 FCC Rcd 16857, 16882-83, para. 50 (1998) (PCIA Forbearance Order).

   See 1998 International Biennial Review Order, 14 FCC Rcd at 4915, para.
   15; PCIA Forbearance Order, 13 FCC Rcd at 16882, para. 50.

   47 C.F.R. S: 63.18.

   See id.

   Id. S:S: 63.18(e)(2), 63.23.

   See Implementation of the Subscriber Carrier Selection Changes Provisions
   of the Telecommunications Act of 1996, Third Report and Order and Second
   Order on Reconsideration, 15 FCC Rcd 15996, 16024-26, paras. 59-62 (2000)
   (Carrier Selection Order).

   47 C.F.R. S: 64.1195; see Telecommunications Reporting Worksheet, FCC Form
   499-A, available at
   http://transition.fcc.gov/Forms/Form499-A/499a2-2011.pdf (Oct. 2011).

   47 U.S.C. S: 225(b)(1).

   See Telecommunications Relay Services and the Americans with Disabilities
   Act of 1990, Third Report and Order, 8 FCC Rcd 5300, para. 3 (1993).
   Telecommunications relay services enable persons with hearing and speech
   disabilities to communicate by telephone with voice-telephone users. Such
   services provide telephone access to a significant number of Americans
   who, without it, might not be able to make calls to or receive calls from
   voice-telephone users. See Telecommunications Relay Services and
   Speech-to-Speech Services for Individuals with Hearing and Speech
   Disabilities, Report and Order, 15 FCC Rcd 5140, 5141, 5143, paras. 2, 5
   (2000). Rolka Loube Salter Associates currently is responsible for
   administering the TRS Fund.

   47 C.F.R. S: 64.604(c)(5)(iii)(A) (requiring every carrier that provides
   "interstate services, including . . . international . . . services" to
   contribute to the TRS Fund).

   47 C.F.R. S: 54.711(a); see also 47 C.F.R. S: 64.604(c)(5)(iii)(A).

   See 47 C.F.R. S: 64.604(c)(5)(iii)(A), (B). Our rules, however, do not
   condition payment on receipt of an invoice or other notice from the TRS
   Fund administrator. See id.

   See 47 C.F.R. S: 54.713(c).

   Section 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. S: 159(a)(1); see also 47 C.F.R. S:S: 1.1151,
   1.1154, 1.1157 Interstate telecommunications service providers (ITSPs) are
   subject to regulatory fees based on billed interstate and international
   end-user revenues for local and most toll services. Carriers whose total
   regulatory fee payment obligation is less than $10 are exempt; however,
   the vast majority of FCC Form 499-A filers are required to pay ITSP
   regulatory fees. See Regulatory Fees Fact Sheet: What You Owe - Interstate
   Telecommunications Service Providers (ITSP) for FY 2011 at 6,
   http://hraunfoss.fcc.gov/edocs_public/attachmatch/DOC-309146A1.doc (rel.
   Aug. 2011).

   See 47 C.F.R. S:S: 1.1154, 1.1157.

   See 47 C.F.R. S: 1.1157(b)(1).

   See 47 U.S.C. S: 159(c)(1), (3).

   Response of RB Communications, Inc., d/b/a Starfone to the Enforcement
   Bureau's March 9, 2009 Letter of Inquiry, dated April 9, 2009, Responses
   to Inquiries 1, 5 (LOI Response).

   Id., Response to Inquiry 2; Response of RB Communications, Inc., d/b/a
   Starfone to the Enforcement Bureau's September 4, 2009 Letter of Inquiry,
   dated September 29, 2009, Responses to Inquiry 19 (FLOI Response).

   Id. Starfone advertises itself as "a value added provider of Long Distance
   (International), prepaid and postpaid calling services based on an online
   pinless calling card system" that allows users global access to over 300
   countries. See Starfone web site at http://www.starfone.net/aboutus.aspx
   (visited April 9, 2012). Starfone states that "although the company's
   business model is to provide international calls only, the configuration
   of its switches does give its end-users the ability to make interstate
   calls which comprise a very small percentage of the company's overall
   traffic." FLOI Response, Response to Inquiry 20(a). In 2004, the company
   received a certificate of public convenience and necessity in California
   to operate as a nondominant interexchange carrier providing inter- and
   intra-LATA services. LOI Response, Response to Inquiry 6.

   FLOI Response, Response to Inquiry 20(c).

   USAC administers the federal Universal Service Fund. 47 C.F.R. S:
   54.701(a).

   Letter from Trent B. Harkrader, Deputy Chief, Investigations and Hearings
   Division, Enforcement Bureau, FCC, to Mr. Lyle Watkins, General Manager,
   Starfone, dated Mar. 9, 2009 (LOI).

   Letter from Trent B. Harkrader, Deputy Chief, Investigations and Hearings
   Division, Enforcement Bureau, FCC, to Mr. Lyle Watkins, General Manager,
   RB Communications, Inc., dated Sept. 4, 2009 (FLOI).

   LOI Response, Response to Inquiry 18.

   See id., Response to Inquiry 8.

   Id., Response to Inquiry 12. TRS contributions are due annually on July
   26.

   See International Authorizations Granted, Public Notice, 25 FCC Rcd 2337,
   2339 (2010) (File No. ITC-214-20100203-00075).

   47 U.S.C. S: 503(b)(1)(B); see also 47 C.F.R. S: 1.80(a)(2).

   47 U.S.C. S: 312(f)(1).

   H.R. Rep. No. 97-765, 97th Cong. 2d Sess. 51 (1982).

   See, e.g., Southern California Broadcasting Co., Memorandum Opinion and
   Order, 6 FCC Rcd 4387, 4388, para. 5 (1991) (Southern California
   Broadcasting Co.).

   See, e.g., Callais Cablevision, Inc., Grand Isle, Louisiana, Notice of
   Apparent Liability for Monetary Forfeiture, 16 FCC Rcd 1359, 1362, para.
   10 (2001) (Callais Cablevision) (issuing a Notice of Apparent Liability
   for, inter alia, a cable television operator's repeated signal leakage),
   forfeiture issued, Forfeiture Order, 17 FCC Rcd 22626 (2002).

   See Callais Cablevision,  16 FCC Rcd at 1362, para. 9; Southern California
   Broadcasting Co.,  6 FCC Rcd at 4388, para. 5.

   47 U.S.C. S: 503(b); 47 C.F.R. S: 1.80(f).

   See, e.g., SBC Communications, Inc., Apparent Liability for Forfeiture,
   Forfeiture Order, 17 FCC Rcd 7589, 7591, para. 4 (2002).

   47 U.S.C. S: 214.

   47 C.F.R. S:S: 1.1154, 1.1157(b)(1), 63.18, 64.604(c)(5)(iii)(A), 64.1195.

   FLOI Response, Response to Inquiry 19.

   See International Authorizations Granted, Public Notice, 25 FCC Rcd at
   2339.

   LOI Response, Response to Inquiry 18; File No. ITC-214-20100203-00075 at
   Attach. 2.

   Starfone's recent Form 499-A filings reflect that it has been providing
   interstate telecommunications service at least since sometime in 2004.

   47 C.F.R. S: 64.1195(a). The Commission adopted the registration
   requirement in Section 64.1195(a) after finding that such a requirement
   would enable it to better monitor the entry of carriers into the
   interstate telecommunications market and any associated increases in
   slamming activity, and, among other things, would enhance the Commission's
   ability to take appropriate enforcement action against carriers that have
   demonstrated a pattern or practice of slamming. See Carrier Selection
   Order, 15 FCC Rcd at 16025, para. 62.

   See The Commission's Forfeiture Policy Statement and Amendment of Section
   1.80 of the Rules to Incorporate the Forfeiture Guidelines, Report and
   Order, 12 FCC Rcd 17087, 17099, para. 22 (1997)("it is each licensee's
   obligation ... to know and comply with all of the Commission's rules").

   E.g., ADMA Telecom, Inc., Notice of Apparent Liability for Forfeiture, 24
   FCC Rcd 838, 846, para. 15 (2009) (ADMA NAL)(citing AT&T Wireless
   Services, Inc., Forfeiture Order, 17 FCC Rcd 21866, 21870-71, paras. 12-14
   (2002); America's Tele-Network Corp., Order of Forfeiture, 16 FCC Rcd
   22350, 22355, para. 15 (2001); Coleman Enters., Inc. d/b/a/ Local Long
   Distance, Inc., Order of Forfeiture, 15 FCC Rcd 24385, 24388, para. 8
   (2000)), forfeiture issued, Forfeiture Order, 26 FCC Rcd 4152 (2011) (ADMA
   Forfeiture Order).

   47 C.F.R. S: 64.604(c)(5)(iii)(A); see also id. at (c)(5)(iii)(B) (setting
   forth methods of computation and payment of contributions to TRS Fund).

   Id. at (c)(5)(iii)(B).

   Id. Under the Commission's rules, each subject carrier must contribute at
   least $25 per year, and providers whose annual contributions are less than
   $1,200 must pay the entire amount at the beginning of the contribution
   period. Otherwise, providers may divide their contributions into equal
   monthly payments. Id. The billing cycle for TRS assessments runs from July
   1 to June 30 of each year, with assessments made based on carriers'
   reported revenue information for the corresponding FCC Form 499-A.

   Because the contributions remain unpaid, these constitute continuing
   violations. See Omniat International Telecom, LLC d/b/a Omniat Telecom,
   Notice of Apparent Liability for Forfeiture and Order, 24 FCC Rcd 4254,
   4265-66, paras. 27, 29 (2009) (Omniat NAL).

   See 47 C.F.R. S:S: 1.1154, 1.1157(b)(1).

   47 C.F.R. S:S: 1.1154, 1.1157(b)(1); see also 47 U.S.C. S: 159(a)(1).
   Because the fees remain unpaid, these constitute continuing violations.
   See Omniat NAL, 24 FCC Rcd at 4266, para. 29; Telrite Corporation, Notice
   of Apparent Liability for Forfeiture and Order, 23 FCC Rcd 7231, 7245,
   para. 35 (2008) (Telrite NAL).

   47 U.S.C. S: 503(b)(1)(B).

   47 U.S.C. S: 503(b)(2)(B); see also 47 C.F.R. S: 1.80(b)(2). The
   Commission has amended Section 1.80(b)(2) of the Rules three times to
   increase the maximum forfeiture amounts, in accordance with the inflation
   adjustment requirements contained in the Federal Civil Penalties Inflation
   Adjustment Act of 1990, 28 U.S.C. S: 2461 note, as amended by the Debt
   Collection Improvement Act of 1996, 31 U.S.C. S: 3701 note. The most
   recent inflation adjustment took effect September 2, 2008 and applies to
   violations that occur after that date. See Amendment of Section 1.80(b) of
   the Commission's Rules, Adjustment of Forfeiture Maxima to Reflect
   Inflation, Order, 23 FCC Rcd 9845 (2008) (adjusting the maximum statutory
   amounts for common carriers from $130,000/$1,325,000 to
   $150,000/$1,500,000).

   47 U.S.C. S: 503(b)(2)(E); see also 47 C.F.R. S: 1.80(b)(6), Note to
   paragraph (b)(6): Guidelines for Assessing Forfeitures.

   47 U.S.C. S: 214(a).

   See, e.g., 47 C.F.R. S:S: 63.12, 63.18, 63.20, 63.21, 63.23; see also 1998
   International Biennial Review Order, 14 FCC Rcd 4909;  Regulation of
   International Common Carrier Services, Report and Order, 7 FCC Rcd 7331
   (1992).

   For example, the Commission's website has a list of frequently asked
   questions about Section 214 applications for providers of international
   telecommunications services. See
   http://transition.fcc.gov/ib/pd/pf/214faq.html. Among the questions and
   answers are the following: "Question: If I am merely reselling the
   international services of another carrier, do I have to file a section 214
   application? Answer: Yes, including in the case of mobile international
   services. Refer to 47 CFR S: 63.18(e)(2), global resale service."

   See supra para. 16.

   See 1998 International Biennial Review Order, 14 FCC Rcd at 4915-17,
   paras. 15-18; id. at 4939-40, paras. 72-74.

   See LOI Response, Response to Inquiry 7 (submitting annual revenue
   information for 2006-2007); see also email from William W. Holcomb, Esq.,
   Counsel for Starfone, to Margaret Dailey, Attorney, Investigations and
   Hearing Division, Enforcement Bureau, FCC, dated January 9, 2012
   (submitting updated annual revenue information for 2008-2010).

   47 U.S.C. S: 503(b)(2)(E).

   ADMA Forfeiture Order, 26 FCC Rcd at 4161-62, para. 27 (assessing a
   $100,000 forfeiture against a prepaid calling card company for
   unauthorized international telecommunications service); Teleplus, LLC,
   Notice of Apparent Liability for Forfeiture, 24 FCC Rcd 7666, 7670-71,
   para. 12 (2009) (same); Omniat NAL, 24 FCC Rcd at 4264, para. 25 (same);
   InPhonic, Inc., Order of Forfeiture and Further Notice of Apparent
   Liability for Forfeiture, 22 FCC Rcd 8689, 8706, para. 41 (2007) (same).

   See Telecom House, Inc., Notice of Apparent Liability for Forfeiture and
   Order; 20 FCC Rcd 15131, 15142, para. 29 (2005), proceeding terminated, 21
   FCC Rcd 10883 (2006); InPhonic, Inc., Notice of Apparent Liability for
   Forfeiture and Order, 20 FCC Rcd 13277, 13287, para. 26 (2005) (InPhonic
   NAL), forfeiture issued, 22 FCC Rcd 8689; Teletronics, Inc., Notice of
   Apparent Liability for Forfeiture and Order, 20 FCC Rcd 13291, 13302,
   para. 30 (2005), proceeding terminated,  22 FCC Rcd 8681 (2007).

   See, e.g., InPhonic NAL, 20 FCC Rcd at 13287, para. 26.

   Id.

   47 U.S.C. S: 225(b)(1).

   See Omniat NAL, 24 FCC Rcd at 4265, 66, paras. 27, 29.

   See Telrite NAL, 23 FCC Rcd at 7243, para. 27.

   See ADMA NAL, 24 FCC Rcd at 853, para. 35; Globcom, Inc. d/b/a Globcom
   Global Communications, Notice of Apparent Liability for Forfeiture and
   Order, 18 FCC Rcd 19893, 19904, para. 29 (2003) (Globcom NAL), forfeiture
   issued, Order of Forfeiture, 21 FCC Rcd 4710, 4721, para. 31 (2006).

   See, e.g., ADMA NAL, 24 FCC Rcd at 853, para. 35; Globcom NAL, 18 FCC Rcd
   at 19904, para. 29.

   See Omniat NAL, 24 FCC Rcd at 4266, para. 29; Telrite NAL, 23 FCC Rcd at
   7245, para. 35.

   See Omniat NAL, 24 FCC Rcd at 4266, para. 29; Telrite NAL, 23 FCC Rcd at
   7245, para. 35; Compass Global Inc., Notice of Apparent Liability for
   Forfeiture, 23 FCC Rcd 6125, 6141-42, para. 38 (2008).

   See Business Options, Inc., Consent Decree, 19 FCC Rcd 2916 (2004); NOS
   Communications, Inc., Affinity Network Incorporated and NOSVA Limited
   Partnership, Consent Decree, 2003 WL 22439710 (2003).

   See 47 C.F.R. S: 1.80(f)(3).

   See 47 C.F.R. S: 1.1914.

   Federal Communications Commission FCC 12-38

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   Federal Communications Commission FCC 12-38