On November 25, FCC Enforcement Bureau Chief Travis LeBlanc penned a blog post outlining the Commission’s enforcement process and touting the upward trend in recent years in collecting fines issued for violations of the Communications Act and the Commission’s rules.  The post was written in response to a recent Politico article suggesting that the agency may be more interested in grabbing headlines rather than actually collecting the massive fines it has announced in recent years.

In the post, Mr. LeBlanc explains that the Enforcement Bureau is required to follow a series of steps when pursuing an enforcement action “in order to protect the integrity of the investigations and ensure fairness to the companies involved.”  These steps are as follows:

  1. The Enforcement Bureau issues a Notice of Apparent Liability (“NAL”) for an alleged violation of the Communications Act.
  2. The company has approximately 30 days to respond to the NAL.
  3. The Bureau reviews the responses, conducts additional investigation as needed, and determines whether to proceed with the penalty proposed in the NAL.
  4. If the Bureau seeks to enforce the proposed fine, it submits the case to the full Commission for a vote to issue a Forfeiture Order (the Commission can also resolve the investigation by reaching a settlement agreement with the company).
  5. A company that receives a Forfeiture Order can challenge the action before the Commission.
  6. After all challenges have been exhausted, the fine must be paid. If not, the Commission will refer the matter to the Department of Justice for collection.

One of the key criticisms in the Politico article – as well as from several members of Congress – is the long delays that often occur between when the Bureau announces an enforcement action and when the Commission actually collects some or all of the proposed penalty.  Mr. LeBlanc responded that certain enforcement cases may take longer to resolve because they require coordination with other agencies or compliance with international treaties or agreements.  The FCC’s rules may also provide some guidance on this issue because while the Commission is required in most instances to issue an NAL within one year of an alleged violation in order to pursue an enforcement action, there is no corresponding time limit to impose a final Forfeiture Order once the NAL has been released.  This gives the Bureau substantial flexibility in the timing of its investigations.

Perhaps the most interesting statements in the post pertain to the FCC’s rate of collection of its fines.  According to Mr. LeBlanc, in 2011 and 2012, the Commission collected just 54.9% and 39.2% of fines issued in those years, respectively, totaling approximately $38.8 million.  By comparison, between 2013 and 2015, “the Commission has collected more than 80 percent of the money owed in imposed fines” and thus far in 2015 has collected nearly $100 million in penalties.

LeBlanc did not release the data that underlies these statistics, so we have been unable to verify the amounts reported.  It appears that these figures include amounts collected via consent decrees in addition to those imposed via a forfeiture order.  Notable 2015 consent decrees that might account for the nearly $100 million figure include two settlements involving PSMS billing, one CPNI/privacy settlement and four settlements involving 911 outages.  These actions alone involve $73 million in civil penalties, not including amounts paid to the states under the PSMS consent decrees.  That would suggest, however, that $25 million was collected as a result of forfeiture orders.  That number seems high, at least based on a preliminary search of forfeitures issued in 2015.

Finally, Mr. LeBlanc said that the Bureau “will not hesitate” when it comes to “protecting consumer data, stopping Wi-Fi blocking, enforcing robocall rules or preventing cramming and slamming.”  In light of the Bureau’s aggressive stance on consumer protection issues, the recent announcement of a Memorandum of Understanding with the Federal Trade Commission, and the addition of privacy expert Jonathan Mayer as the Bureau’s new chief technologist, statements such as these provide valuable insight into the Bureau’s priorities going forward.  Companies that may be subject to the Commission’s ever-widening jurisdiction should continue to be vigilant of new and ongoing enforcement actions, particularly in the areas highlighted above.