FCC proposes $3.5 million fine for slamming/cramming

The U.S. Federal Communications Commission (FCC) has proposed a fine of more than a $3.5 million against a Nevada-based telecommunications firm that allegedly changed the preferred long-distance telecommunications service of a group of consumers without authorization (a practice known as “slamming”), and for placing unauthorized charges on consumers’ telephone bills (known as “cramming”).

In a recent Notice of Apparent Liability for Forfeiture, the Commission proposed a fine of $3,560,000 against Consumer Telecom Inc. of Henderson, NV for multiple instances of slamming or cramming. In this case, Consumer Telecom telemarketers allegedly represented themselves to consumers as employees of their incumbent long-distance carrier. According to the Commission, “CTI apparently took advantage of consumers by masking the true purpose of the call, and then profiting from their obvious confusion about the questions they were asked.”

The Federal Communications Act prohibits carriers from changing a subscriber’s selection of telephone service providers without their explicit permission, or for billing them without authorization. The proposed forfeiture in this case is more than twice the amount proposed by the Commission in December 2012 against a California-based company. In that instance, the Commission proposed a forfeiture of more than $1.4 million against Preferred Long Distance, Inc. of Encino, CA for allegedly switching long-distance telephone service for 14 consumers without authorization.

Read the complete text of the Commission’s Notice of Apparent Liability for Forfeiture against Consumer Telecom.