SBC faces $2.5 million in fines for 271 applications violations

The Federal Communications Commission yesterday issued a Notice of Apparent Liability and Order that proposes to fine SBC Communications $2.5 million for alleged misrepresentations and procedural violations stemming from the carrier’s applications to provide long-distance service in Kansas and Oklahoma.

The FCC began investigating the applications after SBC notified the commission--after it received Section 271 approval--of the possibility that three affidavits concerning the operation of the carrier’s loop-qualification system contained inaccuracies. These affidavits were filed with the FCC on Dec. 11, 2000.

The commission determined that SBC was negligent in collecting the information contained in the affidavits but did not intentionally misrepresent the information. The FCC also concluded that the loop-qualification system operating at the time of the approvals did not violate Section 271 of the 1996 Telecommunications Act.

However, the FCC said SBC “appears to have violated” section 1.17 of the commission’s rules by “intentionally misrepresenting information” to the FCC’s enforcement bureau during the investigation. The proposed fine for this alleged violation is $120,000.

More damaging is the allegation that SBC violated section 1.65 of the commission’s rules by failing to notify the FCC “in a timely manner” that the information in the affidavits was inaccurate. The proposed fine for this alleged violation is $1.2 million.

SBC faces another potential $1.2 million fine for allegedly failing to comply with the terms of a 1999 FCC Consent Decree that called for the carrier to train employees engaged in regular contact with the commission concerning FCC rules that govern contact with the commission.

According to the FCC, the consent decree stemmed from a 1999 investigation that SBC employees had made inaccurate statements to the commission. The commission alleges that SBC “appears not to have complied with this requirement as to one of the affiants” involved in the Kansas and Oklahoma applications.

SBC has 30 days to either pay the proposed fines or reply in writing. Should the carrier choose the latter, the FCC would review the response and issue a final ruling.

An SBC spokesman said the carrier will “vigorously” attempt to clarify the situation during the next 30 days and is confident the commission will reconsider the situation “once all the facts are laid out.”

He indicated SBC is taking particular issue with the training allegation. He said the affiant in question is an SBC employee who does not appear regularly before the commission--“She has only gone before the Commission once or twice in her career”--and, as such, does not require training.

“This is one of the things we’re having a problem with,” the spokesman said. “It’s hairsplitting, and we’re surprised at the level of fine for something that we think will be found to be a technicality at best.”