H. B. 4576
(By Delegates Staton, Fox, Webster, Hrutkay,
Browning, Stalnaker and Perry)
[Introduced February 21, 2002; referred to the
Committee on the Judiciary.]
A BILL to amend and reenact article two-E, chapter twenty-four
of the code of West Virginia, one thousand nine hundred
thirty-one, as amended, relating to requirements for phone
service sales; providing certain definitions; providing for
certain verification and authorization requirements to
change phone service providers; providing for a letter of
agency to act on behalf of a subscriber; establishing a
phone carrier's liability for changing a phone service
provider without authorization; establishing certain
procedures to resolve unauthorized changes in a phone
service carrier and resulting charges; requiring phone
service providers to submit certain unauthorized phone
service change reports to the public service commission;
establishing a prohibition by phone service providers from
changing certain phone services without express consent; and establishing the authority of the public service commission
to administrate and enforce the provisions of this article.
Be it enacted by the Legislature of West Virginia:
That article two-E, chapter twenty-four of the code of West
Virginia, one thousand nine hundred thirty-one, as amended, be
amended and reenacted to read as follows:
ARTICLE 2E. REQUIREMENTS FOR PHONE SERVICE SALES
24-2E-1. Definitions.
For purposes of this article:
(a) "Authorized carrier" means any telecommunications
carrier that submits a change, on behalf of a subscriber, in the
subscriber's selection of a provider of telecommunications
service with the subscriber's authorization verified in
accordance with the procedures specified in this article.
(b) "Executing carrier" means any telecommunications carrier
that effects a request that a subscriber's telecommunications
carrier be changed. A carrier may be treated as an executing
carrier, however, if it is responsible for any unreasonable
delays in the execution of carrier changes or for the execution
of unauthorized carrier changes, including fraudulent
authorizations.
(c) "Local exchange carrier" means any person that is engaged in the provision of telephone exchange service or
exchange access.
(d) "Slamming" means the practice of changing a subscriber's
telephone service without permission.
(e) "Submitting carrier" means any telecommunications
carrier that requests on the behalf of a subscriber that the
subscriber's telecommunications carrier be changed, and seeks to
provide retail services to the end user subscriber. A carrier
may be treated as a submitting carrier, however, if it is
responsible for any unreasonable delays in the submission of
carrier change requests or for the submission of unauthorized
carrier change requests, including fraudulent authorizations.
(f) "Subscriber" means any one of the following:
(1) The party identified in the account records of a common
carrier as responsible for payment of the telephone bill;
(2) Any adult person authorized by such party to change
telecommunications services or to charge services to the account;
or
(3) Any person contractually or otherwise lawfully
authorized to represent such party.
(g) "Telecommunications carrier" means a public utility
providing telephone service.
(h) "Unauthorized carrier" means any telecommunications
carrier that submits a change, on behalf of a subscriber, in the
subscriber's selection of a provider of telecommunications
service but fails to obtain the subscriber's authorization
verified in accordance with the procedures specified in this
article.
(i) "Unauthorized change" means a change in a subscriber's
selection of a provider of telecommunications service that was
made without authorization verified in accordance with the
verification procedures specified in this article.
§24-2E-2.Verification of orders for telecommunications
service.
(a) No telecommunications carrier shall submit or execute a
change on the behalf of a subscriber in the subscriber's
selection of a provider of telecommunications service except in
accordance with the procedures prescribed in this section.
(1) No submitting carrier shall submit a change on the
behalf of a subscriber in the subscriber's selection of a
provider of telecommunications service prior to obtaining:
(A) Authorization from the subscriber, and
(B) Verification of that authorization in accordance with
the procedures prescribed in this section. The submitting carrier shall maintain and preserve records of verification of
subscriber authorization for a minimum period of two years after
obtaining such verification.
(2) An executing carrier shall not verify the submission of
a change in a subscriber's selection of a provider of
telecommunications service received from a submitting carrier.
For an executing carrier, compliance with the procedures
described in this article shall be defined as prompt execution,
without any unreasonable delay, of changes that have been
verified by a submitting carrier.
(3) Commercial mobile radio service providers shall be
excluded from the verification requirements of this article as
long as they are not required to provide equal access to common
carriers for the provision of telephone toll services under
federal law.
(b) Where a telecommunications carrier is selling more than
one type of telecommunications service, such as local exchange,
intraLATA/intrastate toll and interLATA/intrastate toll, that
carrier must obtain separate authorization from the subscriber
for each service sold, although the authorizations may be made
within the same solicitation. Each authorization must be
verified separately from any other authorizations obtained in the same solicitation. Each authorization must be verified in
accordance with the verification procedures prescribed in this
section.
(c) No telecommunications carrier shall submit a preferred
carrier change order unless and until the order has been
confirmed in accordance with one of the following procedures:
(1) The telecommunications carrier has obtained the
subscriber's written or electronically signed authorization in a
form that meets the requirements of section three of this
article; or
(2) The telecommunications carrier has obtained the
subscriber's electronic authorization to submit the preferred
carrier change order. Such authorization must be placed from the
telephone number on which the preferred carrier is to be changed
and must confirm the information in subdivision one of subsection
(a) of this section. Telecommunications carriers electing to
confirm sales electronically shall establish one or more
toll-free telephone numbers exclusively for that purpose. Calls
to those numbers may connect a subscriber to a voice response
unit, or similar mechanism, that records the required information
regarding the preferred carrier change, including automatically
recording the originating automatic number identification; or
(3) An appropriately qualified independent third-party has
obtained, in accordance with the procedures set forth in this
subdivision, the subscriber's oral authorization to submit the
preferred carrier change order that confirms and includes
appropriate verification data, such as the subscriber's date of
birth or social security number. The independent third-party
must not be owned, managed controlled, or directed by the carrier
or the carrier's marketing agent; must not have any financial
incentive to confirm preferred carrier change orders for the
carrier or the carrier's marketing agent; and must operate in a
location physically separate from the carrier or the carrier's
marketing agent.
(A) Automated third-party verification systems and three-way
conference calls may be used for verification purposes so long as
the requirements of subdivision three, subsection (c) of this
section are satisfied.
(B) A carrier or a carrier's sales representative initiating
a three-way conference call or a call through an automated
verification system must drop off the call once the three-way
connection has been established.
(C) All third party verification methods shall elicit, at a
minimum, the identity of the subscriber, confirmation that the person on the call is authorized to make the carrier change,
confirmation that the person on the call wants to make the
carrier change, the names of the carriers affected by the change,
the telephone numbers to be switched, and the types of service
involved. Third-party verifiers may not market the carrier's
services by providing additional information, including
information regarding preferred carrier freeze procedures.
(D) All third-party verifications shall be conducted in the
same language that was used in the underlying sales transaction
and shall be recorded in their entirety. In accordance with the
procedures set forth in this article, submitting carriers shall
maintain and preserve audio records of verification of subscriber
authorization for a minimum period of two years after obtaining
such verification. Automated systems must provide consumers with
an option to speak with a live person at any time during the
call.
(d) Telecommunications carriers must provide subscribers the
option of using one of the authorization and verification
procedures specified in this section in addition to an
electronically signed authorization and verification procedure.
(e) A telecommunications carrier may acquire, through a sale
or transfer, either part or all of another telecommunications carrier's subscriber base without obtaining each subscriber's
authorization and verification in accordance with section four of
this article: Provided, that the acquiring carrier complies with
all Federal Communications Commission rules regarding advance
subscriber notice.
§24-2E-3. Letter of agency.
(a) A telecommunications carrier may use a written or
electronically signed letter of agency to obtain authorization or
verification of a subscriber's request to change his or her
preferred carrier selection. A letter of agency that does not
conform with this section is invalid for purposes of this
article.
(b) The letter of agency shall be a document that is
separate, or easily separable, from other written documents
regarding a change in carrier or located on a separate screen or
webpage containing only the authorizing language described in
subsection (e) of this section having the sole purpose of
authorizing a telecommunications carrier to initiate a preferred
carrier change. The letter of agency must be signed and dated by
the subscriber to the telephone line requesting the preferred
carrier change.
(c) The letter of agency shall not be combined on the same document, screen, or webpage with inducements of any kind.
(d) Notwithstanding subsections (b) and (c) of this section,
the letter of agency may be combined with checks that contain
only the required letter of agency language as prescribed in
subsection (e) of this section and the necessary information to
make the check a negotiable instrument. The letter of agency
check shall not contain any promotional language or material.
The letter of agency check shall contain in easily readable,
bold-face type on the front of the check, a notice that the
subscriber is authorizing a preferred carrier change by signing
the check. The letter of agency language shall be placed near
the signature line on the back of the check.
(e) At a minimum, the letter of agency must be printed with
a type of sufficient size and readable type to be clearly legible
and must contain clear and unambiguous language that confirms:
(1) The subscriber's billing name and address and each
telephone number to be covered by the preferred carrier change
order;
(2) The decision to change the preferred carrier from the
current telecommunications carrier to the soliciting
telecommunications carrier;
(3) That the subscriber designates the submitting carrier to
act as the subscriber's agent for the preferred carrier change;
(4) That the subscriber understands that only one
telecommunications carrier may be designated as the subscriber's
interLATA preferred interexchange carrier for any one telephone
number. For the selection of additional preferred carriers, such
as local exchange, intraLATA/intrastate toll or
interLATA/intrastate toll, the letter of agency must contain
separate statements regarding those choices, although a separate
letter of agency for each choice is not necessary; and
(5) That the subscriber may consult with the carrier as to
whether a fee will apply to the change in the subscriber's
preferred carrier.
(f) Any carrier designated in a letter of agency as a
preferred carrier must be the carrier directly setting the rates
for the subscriber.
(g) Letters of agency shall not suggest or require that a
subscriber take some action in order to retain the subscriber's
current telecommunications carrier.
(h) If any portion of a letter of agency is translated into
another language then all portions of the letter of agency must
be translated into that language. Every letter of agency must be translated into the same language as any promotional materials,
oral descriptions or instructions provided with the letter of
agency.
(i) Letters of agency submitted with an electronically
signed authorization must include the consumer disclosures
required by federal law.
(j) A telecommunications carrier shall submit a preferred
carrier change order on behalf of a subscriber within no more
than sixty days of obtaining a written or electronically signed
letter of agency.
§24-2E-4. Carrier liability for slamming.
(a) Any submitting telecommunications carrier that fails to
comply with the procedures prescribed in this article shall be
liable to the subscriber's properly authorized carrier in an
amount equal to one hundred fifty percent of all charges paid to
the submitting telecommunications carrier by such subscriber
after such violation, as well as for any additional amounts
provided for in section seven of this article. The remedies
provided in this article are in addition to any other remedies
available by law.
(b) Any subscriber whose selection of telecommunications
services provider is changed without authorization verified in accordance with procedures set for in this article is liable for
charges as follows:
(1) If the subscriber has not already paid charges to the
unauthorized carrier, the subscriber is absolved of liability for
charges imposed by the unauthorized carrier for service provided
during the first thirty days after the unauthorized change. Upon
being informed by a subscriber that an unauthorized change has
occurred, the authorized carrier, the unauthorized carrier, or
the executing carrier shall inform the subscriber of this
thirty-day absolution period. Any charges imposed by the
unauthorized carrier on the subscriber for service provided after
this thirty-day period shall be paid by the subscriber to the
authorized carrier at the rates the subscriber was paying to the
authorized carrier at the time of the unauthorized change in
accordance with the provisions of section six-e of this article.
(2) If the subscriber has already paid charges to the
unauthorized carrier, and the authorized carrier receives payment
from the unauthorized carrier as provided for in subsection (a)
of this section, the authorized carrier shall refund or credit to
the subscriber any amounts determined in accordance with the
provisions of section seven-c of this article.
(3) If the subscriber has been absolved of liability as prescribed by this section, the unauthorized carrier shall also
be liable to the subscriber for any charge required to return the
subscriber to his or her properly authorized carrier, if
applicable.
(e) Nothing in this article shall be construed to impose any
liability on a local exchange carrier who executes, in good
faith, an order for a change in a subscriber's telephone service
provider submitted to it by the subscriber or by a submitting
carrier, who otherwise attempts to comply in good faith with the
obligations of an executing carrier under this article, or who in
good faith offers a preferred carrier freeze to a subscriber.
§24-2E-5.Procedure for resolution of unauthorized changes in
preferred carrier.
(a) Executing carriers who are informed of an unauthorized
carrier change by a subscriber shall immediately notify both the
authorized and allegedly unauthorized carrier of the incident.
This notification must include the identity of both carriers.
(b) Any carrier, executing, authorized, or allegedly
unauthorized, that is informed by a subscriber or an executing
carrier of an unauthorized carrier change shall direct that
subscriber to the public service commission for resolution of the
complaint.
(c) Upon receipt of an unauthorized carrier change
complaint, the public service commission shall notify the alleged
unauthorized carrier of the complaint and order that the carrier
remove all unpaid charges for the first thirty days after the
slam from the subscriber's bill pending a determination of
whether an unauthorized change has occurred, if it has not
already done so.
(d) Not more than thirty days after notification of the
complaint, or such lesser time as is required by the public
service commission, the alleged unauthorized carrier shall
provide to the public service commission a copy of any valid
proof of verification of the carrier change. This proof of
verification must contain clear and convincing evidence of a
valid authorized carrier change. The public service commission
has the authority to determine whether an unauthorized change has
occurred using such proof and any evidence supplied by the
subscriber. Failure by the carrier to respond or provide proof
of verification is presumed to be clear and convincing evidence
of a violation.
(e) The public service commission may not adjudicate a
complaint filed pursuant to this article involving an alleged
unauthorized change while a complaint based on the same set of facts is pending with the Federal Communications Commission,
unless the Federal Communications Commission has deferred to the
public service commission on the matter.
§24-2E-6. Absolution procedures where the subscriber has not paid
charges.
(a) This section shall only apply after a subscriber has
determined that an unauthorized change has occurred and the
subscriber has not paid charges to the allegedly unauthorized
carrier for service provided for thirty days, or a portion
thereof, after the unauthorized change occurred.
(b) An allegedly unauthorized carrier shall remove all
charges incurred for service provided during the first thirty
days after the alleged unauthorized change occurred from a
subscriber's bill upon notification that such unauthorized change
is alleged to have occurred.
(c) An allegedly unauthorized carrier may challenge a
subscriber's allegation that an unauthorized change occurred. An
allegedly unauthorized carrier choosing to challenge such
allegation shall immediately notify the complaining subscriber
that the complaining subscriber must file a complaint with the
public service commission within thirty days of either, the date
of removal of charges from the complaining subscriber's bill in accordance with subsection (b) of this section, or the date the
allegedly unauthorized carrier notifies the complaining
subscriber of the requirements of this section, whichever is
later, and a failure to file such a complaint within this
thirty-day period will result in the charges removed pursuant to
subsection (b) of this section being reinstated on the
subscriber's bill and, consequently, the complaining subscribers
will only be entitled to remedies for the alleged unauthorized
change other than those provided for in section four of this
article. No allegedly unauthorized carrier shall reinstate
charges to a subscriber's bill pursuant to the provisions of this
subsection without first providing such subscriber with a
reasonable opportunity to demonstrate that the requisite
complaint was timely filed within the thirty day period described
in this subsection.
(d) If the public service commission determines after
reasonable investigation, that an unauthorized change has
occurred, it has the authority to issue an order providing that
the subscriber is entitled to absolution from the charges
incurred during the first thirty days after the unauthorized
carrier change occurred, and neither the authorized or
unauthorized carrier may pursue any collection against the subscriber for those charges.
(e) If the subscriber has incurred charges for more than
thirty days after the unauthorized carrier change, the
unauthorized carrier must forward the billing information for
such services to the authorized carrier, which may bill the
subscriber for such services using either of the following means:
(1) The amount of the charge may be determined by a
re-rating of the services provided based on what the authorized
carrier would have charged the subscriber for the same services
had an unauthorized change not occurred; or
(2) The amount of the charge may be determined using a fifty
percent proxy rate. Upon receipt of billing information from the
unauthorized carrier, the authorized carrier may bill the
subscriber for fifty percent of the rate the unauthorized carrier
would have charged the subscriber for the services provided.
However, the subscriber shall have the right to reject use of
this fifty percent proxy method and require that the authorized
carrier perform a re-rating of the services provided, as
described in subdivision one of subsection (e) of this section.
(f) If the authorized carrier received payment from the
subscriber for services provided after the first thirty days
after the unauthorized change occurred, the obligations for payments and refunds provided for in section seven of this
article shall apply to those payments. If the public service
commission determines after reasonable investigation that the
carrier change was authorized, the carrier may re-bill the
subscriber for charges incurred.
§24-2E-7.Reimbursement procedures where the subscriber has
paid charges.
(a) The procedures in this section shall only apply after a
subscriber has determined that an unauthorized change has
occurred and the subscriber has paid charges to an allegedly
unauthorized carrier.
(b) If the public service commission determines after
reasonable investigation that an unauthorized change has
occurred, it has the authority, in addition to any other
authority to grant remedies, to issue an order directing the
unauthorized carrier to forward to the authorized carrier the
following:
(1) An amount equal to one hundred fifty percent of all
charges paid by the subscriber to the unauthorized carrier; and
(2) Copies of any telephone bills issued from the
unauthorized carrier to the subscriber. This order shall be sent
to the subscriber, the unauthorized carrier, and the authorized carrier.
(c) Within ten days of receipt of the amount provided for in
subdivision one of subsection (b) of this section, the authorized
carrier shall provide a refund or credit to the subscriber in the
amount of fifty percent of all charges paid by the subscriber to
the unauthorized carrier. The subscriber has the option of
asking the authorized carrier to re-rate the unauthorized
carrier's charges based on the rates of the authorized carrier
and, on behalf of the subscriber, seek an additional refund from
the unauthorized carrier, to the extent that the re-rated amount
exceeds the fifty percent of all charges paid by the subscriber
to the unauthorized carrier. The authorized carrier shall also
send notice to the public service commission that it has given a
refund or credit to the subscriber.
(d) If an authorized carrier incurs billing and collection
expenses in collecting charges from the unauthorized carrier, the
unauthorized carrier shall reimburse the authorized carrier for
reasonable expenses.
(e) If the authorized carrier has not received payment from
the unauthorized carrier as required by subsection (c) of this
section, the authorized carrier is not required to provide any
refund or credit to the subscriber. The authorized carrier shall, within forty-five days of receipt of an order as described
in subsection (b) of this section, inform the subscriber and the
public service commission if the unauthorized carrier has failed
to forward to it the appropriate charges, and also inform the
subscriber of his or her right to pursue a claim against the
unauthorized carrier for a refund of all charges paid to the
unauthorized carrier.
(f) Where possible, the properly authorized carrier must
reinstate the subscriber in any premium program in which that
subscriber was enrolled prior to the unauthorized change, if the
subscriber's participation in that program was terminated because
of the unauthorized change. If the subscriber has paid charges
to the unauthorized carrier, the properly authorized carrier
shall also provide or restore to the subscriber any premiums to
which the subscriber would have been entitled had the
unauthorized change not occurred. The authorized carrier must
comply with the requirements of this section regardless of
whether it is able to recover from the unauthorized carrier any
charges that were paid by the subscriber.
§24-2E-8. Reporting requirement.
Upon request of the public service commission,
each provider
of telephone exchange and/or telephone toll service shall submit to the public service commission a copy of any periodic slamming
report submitted to the Federal Communications Commission.
§24-2E-9. Preferred carrier freezes.
(a) A preferred carrier freeze prevents a change in a
subscriber's preferred carrier selection unless the subscriber
gives his or her express consent to the carrier from whom the
freeze was requested. All local exchange carriers who offer
preferred carrier freezes shall comply with the provisions of
this section.
(b) All local exchange carriers who offer preferred carrier
freezes shall offer freezes on a nondiscriminatory basis to all
subscribers, regardless of the subscriber's carrier selections.
(c) Preferred carrier freeze procedures, including any
solicitation, must clearly distinguish among telecommunications
services, such as local exchange, intraLATA/intrastate toll and
interLATA/intrastate toll, subject to a preferred carrier freeze.
The carrier offering the freeze must obtain separate
authorization for each service for which a preferred carrier
freeze is requested.
(d) Solicitation and imposition of preferred carrier freezes
are governed as follows:
(1) All carrier-provided solicitation and other materials regarding preferred carrier freezes must include:
(A) An explanation, in clear and neutral language, of what
a preferred carrier freeze is and what services may be subject to
a freeze;
(B) A description of the specific procedures necessary to
lift a preferred carrier freeze, an explanation that these steps
are in addition to the verification rules in section two and
three of this article for changing a subscriber's preferred
carrier selections, and an explanation that the subscriber will
be unable to make a change in carrier selection unless he or she
lifts the freeze.
(C) An explanation of any charges associated with the
preferred carrier freeze.
(2) No local exchange carrier shall implement a preferred
carrier freeze unless the subscriber's request to impose a freeze
has first been confirmed in accordance with one of the following
procedures:
(A) The local exchange carrier has obtained the subscriber's
written or electronically signed authorization in a form that
meets the requirements of this article; or
(B) The local exchange carrier has obtained the subscriber's
electronic authorization, placed from the telephone number on which the preferred carrier freeze is to be imposed, to impose a
preferred carrier freeze. The electronic authorization should
confirm appropriate verification data, such as the subscriber's
date of birth or social security number, and the information
required in this subdivision of subsection (d).
Telecommunications carriers electing to confirm preferred carrier
freeze orders electronically shall establish one or more
toll-free telephone numbers exclusively for that purpose. Calls
to the number will connect a subscriber to a voice responses
unit, or similar mechanism that records the required information
regarding the preferred carrier freeze request, including
automatically recording the originating automatic numbering
identification; or
(3) A local exchange carrier may accept a subscriber's
written and signed authorization to impose a freeze on his or her
preferred carrier selection. Written authorization that does not
conform with this section is invalid and may not be used to
impose a preferred carrier freeze.
(A) The written authorization shall comply with subsections
(b), (c), and (h) of section three of this article concerning the
form and content for letters of agency.
(B) At a minimum, the written authorization must be printed with a readable type of sufficient size to be clearly legible and
must contain clear and unambiguous language that confirms;
(1) The subscriber's billing name and address and the
telephone number to be covered by the preferred carrier freeze;
(2) The decision to place a preferred carrier freeze on the
telephone number and particular service. To the extent that the
public service commission allows the imposition of preferred
carrier freezes on additional preferred carrier selections, such
as for local exchange, intraLATA/intrastate toll and
interLATA/intrastate toll service, the authorization must contain
separate statements regarding the particular selections to be
frozen;
(3) The subscriber understands that she or he will be unable
to make a change in carrier selection unless she or he lifts the
preferred carrier freeze; and
(4) The subscriber understands that any preferred carrier
freeze may involve a charge to the subscriber.
(e) All local exchange carriers who offer preferred carrier
freezes must, at a minimum, offer subscribers the following
procedures for lifting a preferred carrier freeze:
(1) A local exchange carrier administering a preferred
carrier freeze must accept a subscriber's written or electronically signed authorization stating his or her intent to
lift a preferred carrier freeze; and
(2) A local exchange carrier administering a preferred
carrier freeze must accept a subscriber's oral authorization
stating her or his intent to lift a preferred carrier freeze and
must offer a mechanism that allows a submitting carrier to
conduct a three-way conference call with the carrier
administering the freeze and the subscriber in order to lift a
freeze. When engaged in oral authorization to lift a preferred
carrier freeze, the carrier administering the freeze shall
confirm appropriate verification data, such as the subscriber's
date of birth or social security number, and the subscriber's
intent to lift the particular freeze.
§24-2E-10.Authority of public service commission;
interpretation.
The public service commission has the exclusive authority to
administrate and to enforce the provisions of article, and the
primary jurisdiction over any conduct that may violate this
article.
NOTE: The purpose of this bill is strengthen the West
Virginia Code provisions against unauthorized telephone service provider changes.
Article two-E of chapter twenty-four has been completely
rewritten; therefore, strike-throughs and underscoring have been
omitted.