FCC Proposes Fine for Unlawful Overcharging of Universal Service Fees

The Federal Communications Commission has proposed a $392,930 fine against NECC Telecom for apparently charging excessive and unlawful universal service fees to its customers.

Phone companies are required to pay into a fund to support various universal service programs and may assess fees on customers to offset that cost. Carriers are prohibited from charging customers more in fees than they pay into the Universal Service Fund (USF). The FCC Enforcement Bureau’s investigation showed that NECC, primarily an international long distance reseller, profited from overcharges labeled as USF-related fees imposed upon its international service customers despite being exempt from any USF contribution obligation. This is the Commission’s first action enforcing FCC rules prohibiting a carrier from collecting more from consumers in USF fees than the carrier actually pays into the USF. The FCC also alleges that NECC failed to pay over $80,000 in mandatory regulatory fees and transferred its authorizations to provide telecommunications services without FCC approval.