Pacific Bell Agrees to Pay $250,000 Fine
Pacific Bell Telephone Co. will pay a $250,000 penalty to settle Federal Communications Commission charges that the San Francisco-based company provided false information that helped boost its income from long-distance telephone companies.
Under the agreement announced Tuesday, the FCC will drop its claim and Pacific Bell promised not to charge customers higher rates to recoup the cost of the $250,000 fine.
The FCC in 1990 accused Pac Bell and three other local telephone companies of erroneously reporting information in late 1988 to the National Exchange Carriers Assn., a nonprofit group set up by the commission to allow long-distance carriers to pay for the use of local companies’ phone lines.
The FCC has not settled its claims with the other companies--New York Telephone, New England Telephone and Southwestern Bell Telephone.
The charges resulted from an FCC audit of Pac Bell and the other companies. Pacific Bell discovered the errors and made billing adjustments before the audit, said Ron Sawyer, a San Francisco-based director of regulatory matters for Pac Bell.
Pac Bell informed the FCC that it had unintentionally violated accounting provisions by making an error in the interpretation of cost recovery rules, Sawyer said.
“I believe the FCC assessed the fine because it concluded that we should have checked with the (commission) if there were any question about the rules,” Sawyer said.