AT&T faces $106,425 fine for charging higher price

The Federal Communications Commission (FCC) is set to charge AT&T with $106,425 for charging two Florida school districts at higher telecom charges in the state, in alleged violation of federal law and the lowest corresponding price rule.

The lowest corresponding price rule enforces the participation of schools and libraries in the E-rate Program by the regulator to get the best rates available by banning E-rate SPs from taking more than the lowest price paid by similar users for comparable services.

The Commission has accused AT&T of charging the school districts with high prices for telephone service that were scaling high in comparison to others in Florida.

At least one of the school districts have paid the highest price in Florida for one service, while others paid less.

Also the FCC plans to order AT&T to repay the $63,760 amount improperly received by it from the Universal Service Fund as a subsidy for these services.

“Charging school districts among the highest rates in the state for telephone or broadband internet service is outrageous,” said Travis LeBlanc, Chief, Enforcement Bureau.

The universal service support program, for schools and libraries, i.e. the E-rate Program, enables eligible schools, libraries, and consortia of eligible schools and libraries to receive discounts on telecommunications services, internet access, internal connections, basic maintenance costs and managed internal broadband services.

“Schools and libraries across the country heavily rely upon federal and state funds to afford these critical services. We expect that every service provider will offer participating schools and libraries the same low rates that they charge to other similarly situated customers,” added LeBlanc.

At the 2014 upgrade of E-rate, the Commission asked the Enforcement Bureau to allocate additional resources for ensuring lowest corresponding price rule. This is to get most benefit from E-rate to produce savings in the program.

The Commission has issued a Notice of Apparent Liability (NAL) against AT&T for violating the lowest corresponding price rule from at least mid-2012 to mid-2015, in the school districts in Orange County and Dixie County, Florida, at rates above those of other users in the state.

Also AT&T had wrongly certified its compliance to the E-rate program and rules during this period.

Based on the above, Universal Service Fund had subsidized the school district services at exorbitant prices allowing AT&T an amount of $63,760 in federal support, which was inappropriate.

The NAL enlists all allegations of unlawful conduct proposing monetary forfeiture for such conduct. The NAL also asks public members to provide related info on this at its consumer complaints portal,

This is not the first time that the group is being penalized by the regulator. AT&T Mobility was recently charged with a fine of $100 million by the regulator in Open Internet Transparency Rule Case. Also, it had consented agreement with the FCC to pay a $25 million civil penalty for data privacy violations and agreed to pay $6.9 million to the regulator for over-billing its low-income support program, known as Lifeline.

In January 2015, The FCC had also voted to charge AT&T with $640,000 for allegedly operating numerous wireless microwave stations without authorization over a multi-year period and failing to provide required license modification notices to the commission.

Vina Krishnan
[email protected]