Enforcement Warning and Rule Revision Issued by FCC

Today, the FCC issued two pronouncements, summarized in a news release, that remind ETCs of the strict level of compliance expected of carriers participating in the Lifeline program.  The FCC Enforcement Bureau issued an advisory reminding ETCs that the ETCs themselves are liable for any violations of the FCC's Lifeline rules committed by their agents, contractors or representatives acting with the scope of their employment.  The advisory notes that ETCs could face fines up to $1.5 million for each violation.

The FCC Wireline Competition Bureau, which is responsible for promulgating the FCC's Lifeline rules, issued a new order modifying the FCC's rules to specify that ETCs may not distribute wireless handset with Lifeline service activated prior to fully verifying the applicant's eligibility.  The FCC added the following language to rule 54.410(a):

An eligible telecommunications carrier may not provide a consumer with an activated device that it represents enables use of Lifeline-supported service, nor may it activate service that it represents to be Lifeline service, unless and until it has (1) confirmed that the consumer is a qualifying low-income consumer pursuant to § 54.409, and (2) completed the eligibility determination and certification required by this section and §§ 54.404-54.405, and completed any other necessary enrollment steps.

The order explains that this rule prohibits an ETC from distributing an activated Lifeline handset "even on an interim basis" during the time that the ETC is completing the process of verifying an applicant's eligibility.