FCC Quick to Threaten Fines, But Slow to Enforce and Collect Them

The Federal Communications Commission (FCC) has proposed fines totaling hundreds of millions of dollars over the last two years, but hasn't collected a penny of that money, and several lawmakers, including Oregon Republican Rep. Greg Walden, want to know why.

"If an enormous fine is announced and it's never prosecuted, it makes you wonder what's the purpose?" Walden, who chairs the House Telecom Subcommittee told Politico.

"The question is, are they just after headlines or some sort of performance metric? I don't know."

The fines have included $100 million against AT&T this summer for throttling unlimited data plans, roughly $100 million against a dozen companies for charges they defrauded the Lifeline phone subsidy program, and $35 million against a Chinese company that was selling illegal wireless jamming equipment.

Companies have up to 30 days to either pay or challenge a fine, but still, the FCC's collections process is cumbersome, and the fine isn't officially due until the investigation is completed, which can take years.

And, even after that, it's up to the Justice Department to collect against companies that don't pay off.

An FCC spokesperson, though, said the practice protects consumers, even if the companies never pay, as often companies adjust their practices and come into compliance with FCC rules.

AT&T, for example, increased its throttling limits in September, bringing some unlimited plan users up from 5 gigabytes a month to 22 gigabytes.

Last month, Missouri Democratic Sen. Claire McCaskill said she is "beyond confused" about why the fines against the companies involved in the Lifeline issue have not been collected.

"We might as well have a big flashing sign that says, 'Doesn't matter, do whatever you want in the Lifeline program because we're not even gonna bother to collect the money. And we're gonna keep paying you,'" she said at FCC Commissioner Jessica Rosenworcel's renomination hearing.

But TracFone, one of the Lifeline providers targeted, said after the hearing that the FCC hadn't imposed its fine on them yet, but declined further comment to Politico.

Threatening companies with fines to get them to change their practices is wrong, though, said Micah Caldwell, vice president of regulatory affairs at ITTA, which represents medium-sized communications companies.

"Certainly the atmosphere and the environment right now is one where providers and [regulated companies] are on alert and concerned about what the future holds for them," she said.

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