By Brian Krebs
washingtonpost.com Staff Writer Tuesday, July 16, 2002; 4:57 PM
The Federal Trade Commission is pressing Congress for authority to regulate the nation's largest telecommunications providers in an effort to shield consumers against aggressive telemarketers and questionable billing practices.
The FTC has long been excluded from regulating the telecom sector, a
job traditionally left to the Federal Communications Commission.
But the FTC now says it needs to be freed from that exception to build its proposed national anti-telemarketing registry. The FTC's concern is that without added oversight powers, the agency could lack the authority to rein in egregious telemarketing practices among local and long-distance phone companies.
Consumer groups support the FTC move, arguing that the agency responsible
for policing the industry - the FCC - has failed to crack down on carriers accused of billing consumers for unauthorized services and "slamming," the illegal practice of
changing a consumer's telephone service without permission.
The added oversight is especially needed in the face of industry
consolidation at a time when the FCC is taking steps to deregulate the
telecom sector, said Gene Kimmelman, Washington director for
Consumers Union.
"This barrage of existing and potential market abuses in a time of
deregulation makes it most important to apply traditional competition
and consumer protection rules to telephone companies," Kimmelman said.
The FTC's proposal is opposed by the telemarketing industry and many
state officials who fear the national do-not-call registry could
preempt stronger state laws.
"This effort simply duplicates what the industry and states are already
doing, and just seems like a ridiculous use of public resources,"
said H. Robert Wientzen, president of the Direct Marketing Institute.
Nationwide, 20 states have adopted do-not-call laws, and the direct
marketing industry maintains a voluntary registry of roughly 4.5
million Americans.
The telecommunications industry also is strongly against the move.
"To add another federal regulator to the mix would only cause confusion
that would not be constructive," said Larry Sargeant of the United States Telecom Association. "No one has identified a particular deficiency with respect to FCC enforcement."
All five FTC commissioners plan to push for the changes at a Senate
Commerce subcommittee hearing on Wednesday.
Sources familiar with the matter say draft legislation that would grant
much of the FTC's request focuses on funding for new consumer
protection measures, and does not seek to involve the commission in
telecommunications merger and competition proceedings, which are
currently decided by the FCC in consultation with the U.S. Justice
Department.
But Mozelle Thompson, one of two Democratic commissioners on
the FTC, said he hopes the commission can use the added authority
to weigh in on competition proceedings within the telecom sector.
"I support a lifting of the common carrier exemption because I think
we can provide substantial expertise on both the consumer protection
and competition sides," Thompson said in an interview.
It remains unclear whether separate legislation stands a chance of
passage this year, particularly given Congress' preoccupation with
the Bush administration's homeland security proposal.
Barry Piatt, spokesman for Sen. Byron Dorgan (D-N.D.), chairman of
the Senate Commerce subcommittee hosting Wednesday's FTC
reauthorization hearing, said his boss remains ambivalent about
the FTC's request.
"He's neither for or against it at this point," Piatt said. "He's
willing to listen to both sides and make a decision when the time comes."
