Telecommunications: FCC Has Made Some Progress in the Management
of Its Enforcement Program but Faces Limitations, and Additional
Actions Are Needed (15-FEB-08, GAO-08-125).
The Federal Communications Commission (FCC) annually receives
about 100,000 complaints from individuals and companies. FCC has
the authority to investigate these complaints and take
enforcement action if it finds a violation of the
telecommunications laws and rules, which are designed to ensure,
for example, that individuals have access to 911 services and a
wider affordable range of communication services. As requested,
this report reviews FCC's enforcement program and (1) summarizes
the number and type of complaints received, investigations
conducted, and enforcement actions taken by FCC from 2003 through
2006; (2) discusses how FCC assesses the impact of its
enforcement program; and (3) discusses challenges FCC faces in
providing complete and accurate information on its enforcement
program. To address these objectives, GAO analyzed FCC's
databases, interviewed FCC officials, telecommunications
executives, and experts.
-------------------------Indexing Terms-------------------------
REPORTNUM: GAO-08-125
ACCNO: A80870
TITLE: Telecommunications: FCC Has Made Some Progress in the
Management of Its Enforcement Program but Faces Limitations, and
Additional Actions Are Needed
DATE: 02/15/2008
SUBJECT: Consumer protection
Data collection
Data integrity
Dispute settlement
Fines (penalties)
Investigations by federal agencies
Law enforcement
Performance measures
Program evaluation
Strategic planning
Systems analysis
Telecommunications
Telecommunications industry
Program goals or objectives
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GAO-08-125
* [1]Results in Brief
* [2]Background
* [3]Complaints Received by FCC Have Increased and the Majority o
* [4]Complaints Received and Processed by FCC's CGB Have Increase
* [5]Enforcement Bureau Opened and Closed a Large Number of Inves
* [6]FCC's Enforcement Bureau Assesses Some Program Outputs, but
* [7]FCC's Enforcement Bureau Measures Outputs Rather Than Outcom
* [8]FCC's Enforcement Bureau Has Not Fully Defined Its Strategy
* [9]Goals and Performance Measures Are Key Elements of Effective
* [10]An Inadequate Data Management System Challenges the Enforcem
* [11]Conclusions
* [12]Recommendations for Executive Action
* [13]Agency Comments and Our Evaluation
* [14]GAO Contact
* [15]Staff Acknowledgments
* [16]GAO's Mission
* [17]Obtaining Copies of GAO Reports and Testimony
* [18]Order by Mail or Phone
* [19]To Report Fraud, Waste, and Abuse in Federal Programs
* [20]Congressional Relations
* [21]Public Affairs
Report to the Chairman, Subcommittee on Telecommunications and the
Internet, Committee on Energy and Commerce, House of Representatives
United States Government Accountability Office
GAO
February 2008
TELECOMMUNICATIONS
FCC Has Made Some Progress in the Management of Its Enforcement Program
but Faces Limitations, and Additional Actions Are Needed
GAO-08-125
Contents
Letter 1
Results in Brief 3
Background 7
Complaints Received by FCC Have Increased and the Majority of
Investigations Have Not Resulted in Enforcement Actions 14
FCC's Enforcement Bureau Assesses Some Program Outputs, but Lacks Key
Management Tools to Measure Outcomes and Manage Its Program 25
FCC's Enforcement Bureau Has Not Fully Defined Its Strategy and Has No
Specific Goals or Performance Measures 27
An Inadequate Data Management System Challenges the Enforcement Bureau's
Ability to Carry Out Its Responsibilities 31
Conclusions 34
Recommendations for Executive Action 36
Agency Comments and Our Evaluation 36
Appendix I Scope and Methodology 42
Appendix II Comments from the Federal Communications Commission 47
Appendix III GAO Contact and Staff Acknowledgments 53
Tables
Table 1: Divisions and Responsibilities of FCC's Enforcement Bureau 9
Table 2: Summary of Enforcement Bureau's Approximately 39,000 Closed
Investigations, Calendar Years 2003 through 2006 21
Figures
Figure 1: Number of Complaints Received and Processed by the Consumer and
Governmental Affairs Bureau, Calendar Years 2003 through 2006 15
Figure 2: Top 10 Complaints Received by the Consumer and Governmental
Affairs Bureau, Calendar Years 2003 through 2006 17
Figure 3: Number of Years Consumer and Governmental Affairs Bureau
Complaints Were Pending, as of December 31, 2006 18
Figure 4: Number of Investigations Opened, Closed, and Pending by the
Enforcement Bureau, Calendar Years 2003 through 2006 19
Figure 5: Disposition of Enforcement Bureau's 39,000 Closed
Investigations, Calendar Years 2003 through 2006 20
Figure 6: Amount of Monetary Forfeitures Assessed and Payments Negotiated
through Consent Decrees, Calendar Years 2003 through 2006 23
Figure 7: Number of Years FCC Enforcement Bureau Investigations Were
Pending, as of December 31, 2006 24
Abbreviations
CGB: Consumer and Governmental Affairs Bureau:
FCC: Federal Communications Commission:
FTC: Federal Trade Commission:
GPRA: Government Performance and Results Act of 1993:
OMD: Office of the Managing Director:
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separately.
United States Government Accountability Office
Washington, DC 20548
February 15, 2008
The Honorable Edward J. Markey:
Chairman:
Subcommittee on Telecommunications and the Internet:
Committee on Energy and Commerce:
House of Representatives:
Dear Mr. Chairman:
The Federal Communications Commission (FCC) is responsible for enforcing
the Communications Act of 1934, as amended (the Act), and Commission rules
and orders. Each year, FCC receives approximately 100,000 complaints from
consumers and companies. FCC has the authority to investigate complaints
and to take enforcement action if it finds that there have been violations
of the various telecommunications laws and Commission rules that are
designed to protect the consumer, ensure public safety, and encourage
competition. Thus, it is important that FCC have a strong and effective
enforcement program that allows it to act on these complaints in an
efficient and equitable manner.
Within FCC, two bureaus--the Consumer and Governmental Affairs Bureau
(CGB) and the Enforcement Bureau--have responsibility for handling the
hundreds of thousands of complaints that FCC receives from individuals and
companies. CGB is primarily responsible for processing the majority of the
complaints that FCC receives from individuals. The Enforcement Bureau is
the primary bureau within FCC that is responsible for enforcing the Act's
provisions and FCC's rules and orders.
You requested that we review FCC's enforcement program. This report (1)
summarizes the number and types of complaints received, investigations
conducted, and enforcement actions taken by FCC during calendar years 2003
through 2006; (2) discusses how FCC assesses the impact of its enforcement
program; and (3) discusses challenges FCC faces in providing complete and
accurate information on its enforcement program.
To provide information on the number and types of complaints received,
investigations conducted, and enforcement actions taken by FCC from 2003
through 2006, we analyzed data entirely from FCC's six databases for
calendar years 2003 to 2006.^1 We primarily focused our analysis on the
approximately 46,000 investigations that FCC conducted during this time
period. We did not review the paper case files that FCC maintains. Our
focus was on the database systems for FCC's enforcement program. To assess
the reliability of FCC's databases, we performed a separate assessment of
each of the five databases and of CGB's database. We identified the degree
of missing, duplicate, and invalid records and analyzed certain data
fields to assess the quality of the data. We found some inconsistencies
and limitations in the databases, which we reported to FCC. We also
reviewed FCC's procedures for handling complaints, conducting
investigations, and taking enforcement actions. While we discuss
limitations of the data in this report, we determined that the data were
sufficiently reliable for us to present some general information regarding
the number and types of complaints, investigations and enforcement
actions.
To identify the challenges FCC faces, we interviewed officials at FCC and
15 companies that are subject to FCC's enforcement, and five experts in
telecommunications. We selected the companies based on the type of
telecommunications services provided (radio and television broadcasting,
cable and satellite, wireless and wireline telecommunications services)
and FCC and industry data for 2006. To assess how FCC measures the impact
of its enforcement program, we reviewed the agency's Strategic Plan for
2006 through 2011, Fiscal Year 2006 Performance and Accountability Report,
Fiscal Year 2006 Congressional Justification of Estimates, and the FCC's
enforcement manual to identify enforcement goals and performance measures.
We also interviewed FCC officials about performance goals and measures and
compared FCC's efforts with performance management practices identified in
prior GAO reports. We conducted this performance audit from November 2006
through December 2007 in accordance with generally accepted government
auditing standards. Those standards require that we plan and perform the
audit to obtain sufficient, appropriate evidence to provide a reasonable
basis for our findings and conclusions based on our audit objectives. We
believe that the evidence obtained provides a reasonable basis for our
findings and conclusions based on our audit objectives. See appendix I for
a more detailed explanation of our scope and methodology.
^1We initially requested data from CGB and the Enforcement Bureau's
databases for calendar years 2000 through 2006 but were told that
information from CGB was only available for calendar years 2003 through
2006. Thus, to be consistent in reporting the results of our review, we
are reporting data from 2003 through 2006.
Results in Brief
Overall, FCC received and processed hundreds of thousands of complaints,
conducted tens of thousands of investigations, and took a limited number
of enforcement actions during calendar years 2003 through 2006. According
to our analysis of FCC's CGB database for 2003 through 2006, during this
period, the number of complaints received by FCC's CGB totaled 454,000 and
grew, from almost 86,000 in 2003, to a high of about 132,000 in 2005. The
CGB processed about 95 percent of these complaints by sending a letter of
acknowledgment to the complainant and, where appropriate, referred them
for resolution to the company that was the subject of the complaint. The
largest number of complaints alleged violations of the Telephone Consumer
Protection Act (TCPA),^2 including violations of the do-not-call list
request and telemarketing during prohibited hours. As of December 2006,
about 23,000 complaints remained open, with 16 percent of them open from 1
to 4 years. In addition, based on our analysis of FCC's Enforcement
Bureau's databases, from 2003 through 2006, FCC's Enforcement Bureau
conducted about 46,000 investigations. These investigations were in
response to complaints that the Enforcement Bureau received directly,
complaints received by CGB, audits and inspections, and self-initiated
inquiries. As of December 2006, the Enforcement Bureau had closed about
39,000 of the 46,000 investigations. Based on our analysis of FCC's
Enforcement Bureau's databases for 2003 through 2006, about 9 percent, or
almost 3,400, of these investigations were closed with an enforcement
action, and approximately 83 percent, or about 32,200, were closed with no
enforcement. We were not able to determine whether enforcement actions had
been taken in the remaining 3,200 closed investigations or to determine
why investigations were closed with no discernible enforcement action
because the Enforcement Bureau databases did not collect this information
systematically. However, Enforcement Bureau officials told us that some
investigations may be closed with no enforcement action for such reasons
as insufficient information or a determination that no violation occurred.
Our analysis of FCC's Enforcement Bureau databases for 2003 through 2006
shows that when FCC took an enforcement action, it generally issued an
admonishment or notice of violation, sometimes assessed a fine, and rarely
relied on more serious enforcement actions. For example, FCC did not issue
any order to cease and desist during this period. As of December 2006,
about 7,200 investigations remained open and almost 1,400 (about 19
percent) were open for 1 to 4 years. According to FCC officials, from 2003
through 2006 the Commission assessed $73 million in fines and payments
negotiated through consent decrees, of which about $53 million, or 72
percent, has been collected.
^2In 1991, Congress enacted TCPA to address a growing number of telephone
marketing calls and certain telemarketing practices thought to be an
invasion of consumer privacy and, in some cases, costly to consumers. See
47 USC 227.
While FCC assesses the impact of its enforcement program by periodically
reviewing certain program outputs, it lacks the management tools needed to
fully measure its outputs and manage its program. Specifically, FCC's
Enforcement Bureau has not set specific enforcement goals, developed a
well-defined enforcement strategy, or established performance measures
that are linked to the enforcement goals. FCC measures outputs, such as
the extent to which it takes enforcement action within its statute of
limitations requirement for assessing fines or the time it takes to close
investigations, but it does not measure outcomes such as the effects of
its enforcement actions on levels of compliance in certain areas. Without
key management tools, FCC may have difficulty fully assuring Congress and
other stakeholders that it is meeting its enforcement mission of
protecting the consumer, ensuring public safety, and encouraging
competition.
Limitations in FCC's current approach for collecting and analyzing
enforcement data constitute the principal challenge FCC faces in providing
complete and accurate information on its enforcement program. These
limitations make it difficult to conduct trend analysis, determine program
effectiveness, allocate Commission resources, or accurately track and
monitor key aspects of all complaints received, investigations conducted,
and enforcement actions taken. Currently, the Enforcement Bureau uses five
separate databases and manually searches tens of thousands of paper case
files to track and monitor the extent to which each of its divisions takes
enforcement action within its statute of limitations requirement for
assessing fines or the time it takes to close an enforcement case.
Consequently, we could not use the Enforcement Bureau's databases to
obtain bureauwide information on the 1-year statute of limitations for
imposing monetary forfeitures, the speed with which the Enforcement Bureau
closed an investigation, the reasons for closing investigations with no
enforcement action, or the amount of the fines FCC assessed. Our past work
has shown that when data management systems are not integrated and
compatible, excessive use of resources and inconsistent analysis of
program results can occur.
To develop a more efficient and effective approach to enforcing
communications laws and Commission rules and orders, we recommend that the
Chairman of the Federal Communications Commission
o improve how FCC collects and analyzes data on complaints
received, investigations conducted, and enforcement actions taken
to help it better manage and understand the outcomes and net
results of enforcement efforts and provide Congress and
stakeholders with timely and accurate information that can be used
to hold FCC accountable for accomplishing its enforcement mission
under the Act; and
o develop and implement performance management practices for the
Enforcement Bureau, such as a well-defined strategy that includes
specific goals and performance measures, in order to assess the
effectiveness of FCC's enforcement program.
We provided a draft of our report to FCC for review and comment. FCC
commented that it has already implemented measures that address both of
our recommendations. In addition, FCC disagreed with our methodology and
several of our findings. FCC's comments appear in appendix II. FCC also
provided over 100 pages of attachments in its comments. Because these
attachments cover time periods that are after the scope of our audit and
are voluminous, we have decided to characterize the attachments rather
than include them in their entirety.^3 FCC also provided technical and
legal clarifications, which we incorporated as appropriate. We also
clarified our methodology for analyzing FCC's databases. These technical
and legal changes did not affect our findings, conclusions, or
recommendations.
We are pleased that FCC is moving in the direction suggested by our
recommendations, but we disagree with FCC that it has already fully
implemented them; we also disagree with FCC's criticisms of our
methodology and findings. We believe that our report provides an accurate
and sufficient overview of FCC's processes for handling complaints,
conducting investigations, and taking enforcement actions and the results
of FCC's efforts to enforce telecommunications laws and the Commission's
rules from 2003 through 2006, the latest year complete data was available.
We also exercised caution in writing our report to ensure that we
explained that the results of our analysis are based entirely on FCC's
databases. In our view, FCC's concerns about the accuracy of our findings
stem from (1) the challenges FCC faces in not having a data management
system that will allow it to systematically collect and analyze
information about complaints, investigations, and enforcement actions and
(2) the Commission's use of an approach that differs significantly from
ours. We discuss the challenges posed by FCC's data management system in
our report and point out that without improvements, such as we recommend,
FCC cannot readily analyze trends, determine program effectiveness,
allocate Commission resources, or accurately track and monitor key aspects
of all complaints received, investigations conducted, and enforcement
actions taken. In addition, the Commission's use of data for 2007 and data
from the thousands of paper case files, both of which were outside the
scope of our analysis, necessarily led to findings that differed from
ours, but these differences do not affect the appropriateness of our
methodology or the accuracy of our findings.
^3GAGAS does not require us to print in its entirety responses submitted
by an agency in connection with our reports and allows us to characterize
responses where suitable and to include or not to include them as
appropriate.
FCC disagreed with our methodology and our findings, conducted its own
analyses, and included the results of these analyses in attachments to its
comments. We believe that our methodology meets generally accepted
government auditing standards which require that we plan and perform the
audit to obtain sufficient, appropriate evidence to provide a reasonable
basis for our findings, conclusions, and recommendations. However, while
FCC did not provide its methodology, its overall approach differs
significantly from the approach we used. In its comment letter, FCC
acknowledged that it had to review about 46,000 paper case files and use
its databases to determine the reasons why investigations were closed with
no enforcement action. FCC also acknowledged that it conducted a manual
review of a variable in its database that we could not use because of
reliability concerns. As noted in our report, the data that we used for
our analyses are derived directly from FCC's databases. We did not review
the 46,000 paper case files that FCC maintains. Our focus was on the
database systems for FCC's enforcement program.
FCC also disagreed with our finding that 83 percent of its investigations
were closed with no enforcement action and that there were no
justifications for these closures in its databases. In its comments, FCC
stated that based on its analysis of its databases and paper case files,
85 percent of its investigations were closed with no enforcement action
and 96 percent of these closures were due to findings of compliance or
insufficient information from the complainant. To determine the reasons
why investigations were closed, we attempted to identify a reliable
variable in FCC's enforcement database that clearly categorized the
justifications for closing an investigation with no enforcement action. No
such variable exists. As an alternative, FCC referred us to open-ended
text variables. We reviewed these variables, and in June 2007, told FCC
officials that we could not use these variables because they are
frequently blank or, if completed, contain varying amounts of text to
justify the actions or lack thereof. While such information may be useful
to the FCC analysts working on the complaints, they are not usable for
management information purposes. In addition, as FCC acknowledged in its
comments, to determine the reasons why its investigations were closed with
no enforcement action, it had to review approximately 46,000 paper case
files. As noted in this report, the data that we used for our analysis are
derived entirely from FCC's databases. We did not review the 46,000 paper
case files that FCC maintains. Our focus was on the database systems for
FCC's enforcement program. Our understanding is that FCC analysts reviewed
the information from its databases and paper case files and categorized
the reasons for approximately 46,000 investigations in response to our
initial analysis. We believe that FCC should have data management systems
that allow it to generate this type of information automatically,
reliably, and regularly. Consequently, we stand by our recommendation that
FCC needs to improve how it collects and analyzes data on complaints
received, investigations conducted, and enforcement actions taken to
better manage its enforcement program.
Background
Two bureaus within FCC--CGB and the Enforcement Bureau-- have
responsibilities for developing and implementing procedures for processing
complaints, conducting investigations, and taking enforcement action if
appropriate. CGB has primary responsibility for processing the majority of
the complaints that FCC receives and for responding to other consumer
complaints and inquiries.^4 For example, some of these complaints allege
that (1) common carriers may have violated telecommunications laws and FCC
rules; (2) television and radio broadcasters may have violated indecency
rules; and (3) nonregulated entities, such as telemarketers, may have
violated some aspects of the TCPA, such as the do-not-call list request.
CGB may also receive complaints and inquiries about consumer issues from
congressional offices and FCC Commissioners. Under CGB's process,
complaints are logged upon receipt into CGB's database, and acknowledgment
letters are sent to the complainants notifying them that FCC received the
complaint. Complaints against common carriers are processed according to
the procedures outlined in FCC's regulations, which require FCC to forward
the complaint to the carrier that allegedly committed the violation and
ask the carrier to respond to the complainant and FCC.^5 If the common
carrier responds to the complainant by, for example, issuing a refund or
explaining the charges, then CGB takes no further action. However, if the
company does not respond, then CGB initiates additional contact after 30
days and, again, after 60 days, to get the complaint resolved. A CGB
official told us that CGB also receives a copy of the carrier's response
to the complaint. According to FCC, voluntary action by the carrier to
achieve consumer satisfaction is the expected outcome for most of the
complaints CGB receives. However, if this outcome is not achieved, the
complainant may pursue the matter by filing a formal complaint with FCC's
Enforcement Bureau.^6 CGB responds to other complaints, such as those
concerning junk faxes, by acknowledging receipt of the complaint and then
closing the case.
^4FCC refers to the complaints it receives as formal and informal;
however, for purposes of this report we are not making that distinction.
Formed in November 1999, the Enforcement Bureau consolidates the
enforcement functions of FCC's policy bureaus, which formerly carried out
their own investigations and enforcement activities.^7 The areas of
enforcement that are handled by the Enforcement Bureau are consumer
protection, local competition, and public safety. The Enforcement Bureau
has four divisions and 25 field offices in three geographic regions. These
five divisions are responsible for conducting investigations and taking
enforcement actions, if appropriate (see table 1).^8
^5 47 C.F.R. S 1.717.
^6 47 C.F.R. S 1.717-1.718. Special rules apply to the handling of informal
slamming complaints. See 47 C.F.R. 1.719.
^7Other FCC bureaus continue to handle some enforcement issues. For
example, enforcement issues related to licenses are handled by the
relevant licensing bureau.
^8For purposes of this report, we are including the 25 field offices as
one of the Enforcement Bureau's five divisions.
Table 1: Divisions and Responsibilities of FCC's Enforcement Bureau
Division: Investigations and Hearings;
Primary responsibilities: Investigates and takes or recommends
enforcement action against (1) broadcast licensees for violations of
nontechnical Commission rules concerning issues, such as indecency,
enhanced underwriting, unauthorized assignments and transfers of
control of licenses; (2) wireless licensees for violations of
nontechnical rules involving such issues as auction collusion and
unauthorized assignments and transfer of control of licensees; (3)
common carriers in cases involving alleged or suspected misconduct; and
(4) in cases involving suspected violations of the laws and rules
governing universal service. This division also serves as trial staff
in formal hearings.
Division: Spectrum Enforcement;
Primary responsibilities: Investigates and takes or recommends
enforcement action for violation of public-safety related and other
technical rules, such as those governing interference, tower marking
and lighting, the Emergency Alert System, 911, Enhanced 911, and
compliance with operational provisions of licenses. This division also
handles enforcement action in the areas of unauthorized equipment,
network reliability or network outages, and digital television, among
others.
Division: Telecommunications Consumers;
Primary responsibilities: Investigates and takes or recommends
enforcement action for violations of consumer-related obligations of
common carriers and other telecommunications entities, such as
slamming, junk faxes, and prohibited calls to do-not-call list request
subscribers, and adjudicating formal complaints filed against
telecommunications entities that raise consumer issues and proceedings
on the accessibility of telecommunications services and equipment to
persons with disabilities.
Division: Market Disputes Resolution;
Primary responsibilities: Resolving complaints by market participants,
entities, or organizations against common carriers for alleged
violations of the Act that are filed under section 208 of the Act;
resolving complaints filed by cable operators, telecommunications
carriers, utilities, and other parties relating to the reasonableness
of rates, terms, and conditions for pole attachments as stated under
section 224 of the Act; and facilitating settlements of disputes by
engaging the parties in mediation.
Division: Field Offices;
Primary responsibilities: Responding to spectrum and homeland-security-
related safety of life and public safety matters, investigating
interference complaints, inspecting FCC-regulated entities, and taking
or recommending enforcement action for violations of public safety and
technical rules.
Source: FCC
The Enforcement Bureau generally investigates alleged violations of
telecommunications and Commission rules in response to complaints received
directly from an individual or an entity or from complaints it selected
from CGB's database. After a complaint is received, Enforcement Bureau
staff review it to determine whether it meets FCC's sufficiency of
evidence and jurisdictional requirements. If a complaint does not meet
these requirements, an investigation is not conducted. While Enforcement
Bureau officials told us that FCC's enforcement work is primarily
complaint-based, the bureau does initiate a few investigations in response
to audits or observations made during the normal course of agency
business, such as research during other investigations. If a violation is
found during an investigation, then the Enforcement Bureau may take
enforcement action.
Once a violation is found, the Commission may impose a range of
enforcement actions. According to FCC, potential enforcement actions
include the following:^9
o Admonishment. A notice that serves to inform the subject that
its action violates the Act or Commission rules, orders, or terms
and conditions of authorizations and allows the Enforcement Bureau
to establish a record of enforcement action in cases where a
forfeiture is not warranted.
o Cease and desist order. An order requiring a person to cease and
desist from violation of the Act or Commission rules.^10
o Citation. Provides notice to parties who do not ordinarily
conduct business with FCC (i.e., persons not holding or applying
for Commission authorizations) that their actions violate the Act
or FCC rules and could subject them to a monetary forfeiture. A
forfeiture may not be issued for the subject of a citation but may
be imposed for subsequent violations.
o Consent decree. An agreement between FCC or the Enforcement
Bureau and the party of an investigation that sets forth the terms
and conditions of accepted behavior to which that subject must
conform in exchange for closure of the investigation or forfeiture
proceedings. A consent decree generally includes a compliance plan
and a voluntary contribution to the U.S. Treasury.
o Criminal and civil penalties. The Act provides for a fine of not
more than $10,000 or a criminal penalty of imprisonment for up to
1 year for a first-time conviction of willfully and knowingly
violating the Act (47 USC S 501). A second conviction for
violating any provision of the Act is punishable by a fine of not
more than $10,000 or imprisonment for up to 2 years. FCC has no
authority to initiate a criminal action against a subject for
violation of the Act; instead, FCC must refer such a matter to the
Department of Justice.
o Debarment.^11 FCC's debarment rules establish procedures to
prevent persons who have been convicted of or held civilly liable
for attempting to commit or committing a variety of offenses from
engaging in activities with or related to universal service
mechanisms. The offenses covered by the rule include criminal
fraud, theft, embezzlement, forgery, bribery, falsification or
destruction of records, making false statements, receiving stolen
property, making false claims, and obstruction of justice or other
fraud or criminal offense arising out of activities associated
with or related to universal service mechanisms, such as the
schools' and libraries' support mechanisms.
o Equipment seizure (In Rem seizure). Primarily used in cases
involving unlicensed or pirate radio stations where FCC field
agents, in conjunction with the U.S. Marshal Service and the U.S.
Attorney's Office, seize radio transmitting equipment.
o Monetary forfeiture. A fine assessed for violation of the Act or
FCC rules, orders, or terms and conditions of an authorization.
The Act provides two methods by which FCC may assess monetary
forfeitures. The most commonly used method is to issue a notice of
apparent liability. This notice, which is a proposed action,
informs the subject that FCC believes that a violation has
occurred and that a forfeiture in a specified dollar amount is
warranted. The other method is the issuance of a notice of
opportunity for hearing. This hearing process is typically used in
application hearing designation and revocation proceedings and
entitles the subject to a full hearing before an administrative
law judge.
o Notice of violation. A notice generally issued by an FCC field
office to an FCC-regulated entity concerning a violation of laws
or rules that is identified during an inspection. The notice
requires the subject to respond to the allegation and, based on
the response, additional action may be taken.
o Revocation of license. Reserved for the most egregious
violations of the law that raise serious questions about a
licensee's basic qualifications to be and remain a licensee. Such
offenses include misrepresentation, lack of candor, and repeat
violations of the Act or Commission rules and orders.^12
^9According to FCC, besides enforcement actions, investigations may also
result in denials, dismissals, or a determination that a party complied
with relevant rules.
^10According to FCC, a cease and desist order can only be issued by the
Commission or an administrative law judge following a hearing.
^1147 CFR S 54.8.
^12According to FCC, as with cease and desist orders, a revocation of
license can only be issued by the Commission or an administrative law
judge following a hearing.
The Commission may assess a monetary forfeiture for violations of the Act,
the Commission's rules, a Commission order, or terms and conditions of an
authorization. The Commission's general legal authority can be found in
Section 503 of the Act.^13 Section 503 of the Act sets forth maximum
forfeiture amounts for violations by licensees or regulated entities.
Section 503(b) of the Act requires that the Commission take into account
the nature, circumstances, extent, and gravity of the violation and, with
respect to the violator, the degree of culpability, any history of prior
offenses, ability to pay, and any other such matters as justice may
require. These requirements are implemented by FCC rules.^14 In 1997, to
help implement these criteria, the Commission adopted Guidelines for
Assessing Forfeitures.^15 These guidelines are used to help determine the
amount of a forfeiture for a specific violation and to provide a base
forfeiture amount for most of the common violations. The base amount can
be adjusted up or down, depending on the existence of factors meeting the
adjustment criteria, such as a history of prior violations. Although the
guidelines represent the general method for assessing forfeitures, the
Commission has discretion to depart from them when appropriate.
Section 503 (b) of the Act also limits the time within which FCC may
assess a monetary forfeiture. For common carriers and all other entities
except broadcast licensees, the notice of apparent liability or notice of
opportunity for hearing is required to be issued within 1 year of the
violation. For broadcast licensees, the notice of apparent liability or
notice of opportunity for hearing may be issued if the violation occurred
during the current license term or within the last year, whichever is
earlier.
^13Other forfeiture amounts or other sanctions are established in other
sections of the Communications Act of 1934, as amended, including sections
202(c); 203 (e); 205(b); 214(d); 219(b); 220(d); 364(a)-(b); 386(a)-(b);
and 634.
^14See 47 C.F.R. S 1.80 for current maximum forfeiture amounts. In
accordance with the inflation adjustment requirements contained in the
Debt Collection Improvement Act of 1996, Pub. L. 104-134, Sec. 31001, 110
Stat. 1321, the Commission has twice implemented an increase of the
maximum statutory forfeiture amounts.
^15See Forfeiture Policy Statement and Amendment of Section 1.80 of the
Rules to Incorporate the Forfeiture Guidelines, Report and Order, 12 FCC
Rcd 17087 (1997) ("Forfeiture Policy Statement"), recon. denied, 15 FCC
Rcd 303 (1999); 47 C.F.R. S 1.80(b)(4), note to paragraph (b)(4).
After a fine is assessed, information on the fine is sent to the Office of
the Managing Director (OMD) for tracking and monitoring of payment. OMD
has responsibility within FCC for keeping track of what fines have and
have not been paid. The Enforcement Bureau receives reports from OMD and
has access to OMD's database to monitor payment, as well. Although the
Enforcement Bureau and the Commission have the legal authority to impose
fines, the U.S. Department of Justice has the authority to collect unpaid
fines. Thus, when a case is past due, the Enforcement Bureau refers the
case to its Office of General Counsel, which then determines whether or
not to refer the case to the U.S. Department of Justice for collection.
Once the U.S. Department of Justice receives a referral from FCC's Office
of General Counsel, it can decide whether or not to pursue a case or to
collect a fine.
Companies have several opportunities to respond to FCC's assessment of a
monetary forfeiture. For example, after a notice of apparent liability is
issued, a company may submit information, including financial information,
and request that the fine amount be reduced or cancelled. If FCC decides
to move forward with the fine (whether the original amount or a reduced
amount) and the company disagrees with the fine, then the company can ask
for the fine to be reviewed. Companies may request that the Commissioners
review the fine by filing a petition for reconsideration of an Enforcement
Bureau forfeiture order or submitting an application for review of a fine
issued by the Commission.
At any point during an investigation or after a fine has been assessed, a
company may request to settle with FCC and enter into a consent decree. A
consent decree terminates the investigation or forfeiture, and the subject
of the investigation agrees to certain terms and conditions but typically
does not admit or deny any wrongdoing. The terms and conditions usually
include specific steps to correct the violation and ensure future
compliance, as well as a voluntary monetary contribution to the U.S.
Treasury.
In commenting on a draft of this report, FCC disagreed with our
description of its process for responding to consumer complaints and said
that during the course of our review it began responding to 100 percent of
consumer complaints. Our description of FCC's process for responding to
consumer complaints is based on information it provided to us during the
course of our review. During the course of our review, FCC stated that it
planned to change its process for responding to consumer complaints.
However, in the 100 page attachment to its letter FCC did not provide any
documentation explaining how or when the process changed. Thus, we were
not able to evaluate any changes that FCC may have made to it process for
responding to consumer complaints. As part our routine recommendation
follow-up work, we will inquire about FCC's progress in this area.
Complaints Received by FCC Have Increased and the Majority of Investigations
Have Not Resulted in Enforcement Actions
Overall, FCC received and processed hundreds of thousands of complaints
and conducted thousands of investigations but took a limited number of
enforcement actions from 2003 through 2006. The number of consumer
complaints received by CGB totaled about 454,000 and increased by about 40
percent during this period. As of December 31, 2006, about 95 percent of
these complaints were closed. In addition, the Enforcement Bureau
conducted about 46,000 investigations and closed about 39,000, of which
almost 3,400 resulted in an enforcement action and about 32,200 did not
result in an enforcement action. About 7,200 investigations remained open.
According to FCC, it has collected about 72 percent of the $73 million in
monetary forfeitures and payments associated with consent decrees issued
from 2003 through 2006.
Complaints Received and Processed by FCC's CGB Have Increased
For calendar years 2003 through 2006, the number of complaints received by
CGB totaled about 454,000 and grew, from almost 86,000 in 2003, to a high
of about 132,000 in 2005, as shown in figure 1. Also, as shown in figure
1, the number of complaints processed during these years increased,
reaching a high of 116,000 in 2005.
Figure 1: Number of Complaints Received and Processed by the Consumer and
Governmental Affairs Bureau, Calendar Years 2003 through 2006
In its written comments, FCC said that figure 1 only reflects the status
of complaints received by CGB during the year in which the complaint was
received and that the figure does not reflect complaints that were closed
in subsequent years. This figure is designed to show a year-by-year
analysis of the number of complaints received, processed, and not
processed by CGB in the same year and is not designed to show the number
of complaints that were received in one year and processed in a subsequent
year.
Furthermore, from 2003 through 2006, about 65 percent of the 454,000
complaints received by CGB were about alleged violations of the FCC's TCPA
rules, as well as billing and rates for wireline and wireless services, as
shown in figure 2. TCPA complaints, which include allegations of failing
to honor the do-not-call list request and soliciting during prohibited
hours, increased, from almost 25,000 in 2003, to a high of about 58,000 in
2005.^16 In addition, complaints about billing and rates for wireline and
wireless services increased, from almost 30,000 in 2003, to almost 36,000
in 2004; complaints then decreased to about 21,000 in 2006. These
complaints included not receiving credits, refunds, or adjustments that
were owed to the subscriber; questions about local, state, or federal
taxes appearing on the complainant's bills; and premature termination of
calls. The overall trend for programming issues, such as indecency, has
been steadily upward. For example, this type of complaint increased, from
about 700 in 2003, to almost 9,000 in 2006.
^16Under FCC's TCPA rules, no person or entity may initiate any telephone
solicitation to a residential telephone subscriber before 8 a.m. or after
9 p.m., based on the called party's local time. 47 C.F.R. 64.1200(e)(1).
Figure 2: Top 10 Complaints Received by the Consumer and Governmental
Affairs Bureau, Calendar Years 2003 through 2006
Our analysis of CGB's database shows that, as of December 31, 2006, CGB
had processed almost 95 percent of the 454,000 complaints it received from
2003 through 2006. Of the 23,000 complaints that were not processed, about
84 percent, or 19,400, were pending for less than 1 year, and about 16
percent, or almost 3,600, were pending for 1 to 4 years, as shown in
figure 3. Most of the complaints that remained pending were potential TCPA
and billing violations.
Figure 3: Number of Years Consumer and Governmental Affairs Bureau
Complaints Were Pending, as of December 31, 2006
Enforcement Bureau Opened and Closed a Large Number of Investigations, but Few
Enforcement Actions Were Taken
Based on our analysis of FCC's Enforcement Bureau's databases for calendar
years 2003 through 2006, the Enforcement Bureau opened a total of about
46,000 investigations that resulted from complaints it received directly,
audits and inspections, self-initiated inquiries, and complaints it
selected from CGB's database; the bureau closed about 39,000 of these
investigations.^17 As shown in figure 4, the number of investigations the
Enforcement Bureau opened between 2003 and 2006 increased, from about
8,600 in 2003, to almost 19,600 in 2006, or about 127 percent. Similarly,
the number of investigations closed by the Enforcement Bureau in the same
year they were opened also increased, from about 7,400 in 2003, to almost
13,800 in 2006, or about 85 percent. However, the number of investigations
pending in the same year they were opened almost quadrupled--increasing
from almost 1,200 in 2003, to about 5,800 in 2006. In addition, while the
number of investigations opened and closed increased in 2005 and 2006, the
percentage of investigations closed in these years is starting to trend
downward to about 78 and 70 percent, respectively, compared with about 85
percent in 2003 and 2004.
^17The Enforcement Bureau does not investigate every complaint received by
CGB. We were not able to identify the number of complaints from CGB's
database that the Enforcement Bureau selected for investigation.
Figure 4: Number of Investigations Opened, Closed, and Pending by the
Enforcement Bureau, Calendar Years 2003 through 2006
Using the data that was available in the Enforcement Bureau's databases,
we determined that about 9 percent, or almost 3,400 of the approximately
39,000 investigations, were closed with an enforcement action, and about
83 percent, or about 32,200 of the investigations, were listed as closed
with no enforcement action, as shown in figure 5. We asked Enforcement
Bureau officials to provide information on why investigations were closed
with no enforcement action. They explained that investigations are
generally closed for a number of reasons, including insufficient
information or because no violation was found. Enforcement Bureau
officials also stated that a time-consuming, manual review of the paper
case files was necessary to provide specific information on its
enforcement activities. We also were not able to determine whether
enforcement actions were taken or not taken for the remaining 8 percent,
or about 3,200 closed investigations, because the Enforcement Bureau's
databases did not contain sufficient information on the disposition of the
investigations.
Figure 5: Disposition of Enforcement Bureau's 39,000 Closed
Investigations, Calendar Years 2003 through 2006
Note: The information in this figure was derived entirely from our
analysis of FCC's Enforcement Bureau's databases. This figure does not
include 283 proceedings closed by the Market Disputes Resolution Division.
Market Disputes Resolution Division cases result in FCC's issuance of an
order to resolve a dispute between two companies, rather than a specific
enforcement action taken by FCC against a subject.
Enforcement actions can help correct identified compliance problems and
deter future noncompliance. As shown in table 2, the majority of the
investigations conducted from 2003 through 2006, which totaled about
20,000, were potential violations regarding antenna lighting and structure
requirements, ^18 junk faxes, domestic interference, and indecency. FCC
took enforcement actions in about 1,300 of these investigations;
admonishments, warnings, citations, and notices of violation were the
primary actions taken. FCC rarely relied on more serious enforcement
actions, such as issuing an order to cease and desist. According to FCC,
it takes several factors into account, such as the nature and extent of
the violation and whether the violator had any history of prior offenses,
before determining the type of enforcement action.
^18For public safety purposes, FCC requires owners to register antenna
structures that are more than 200 feet in height or located near an
airport.
Table 2: Summary of Enforcement Bureau's Approximately 39,000 Closed
Investigations, Calendar Years 2003 through 2006
Type and number of investigations: Antenna lighting and structure
requirements (9,241);
Admonishment and warning: 320;
Citation: [Empty];
Consent decree: [Empty];
Debarment: [Empty];
Monetary forfeiture[B]: 49;
Notice of violation: 244;
Closed; no action taken: 8,628;
Unable to determine if any action was taken: [Empty].
Type and number of investigations: Junk fax (4,135);
Admonishment and warning: [Empty];
Citation: 192;
Consent decree: [Empty];
Debarment: [Empty];
Monetary forfeiture[B]: 1;
Notice of violation: [Empty];
Closed; no action taken: 3,942;
Unable to determine if any action was taken: [Empty].
Type and number of investigations: Domestic interference (3,539);
Admonishment and warning: 221;
Citation: 30;
Consent decree: [Empty];
Debarment: [Empty];
Monetary forfeiture[B]: 54;
Notice of violation: 114;
Closed; no action taken: 3,120;
Unable to determine if any action was taken: [Empty].
Type and number of investigations: Indecency (3,075);
Admonishment and warning: [Empty];
Citation: [Empty];
Consent decree: 85;
Debarment: [Empty];
Monetary forfeiture[B]: 11;
Notice of violation: [Empty];
Closed; no action taken: 2,880;
Unable to determine if any action was taken: 99.
Type and number of investigations: Customer Proprietary Network
Information (CPNI); certification (2,315);
Admonishment and warning: [Empty];
Citation: [Empty];
Consent decree: [Empty];
Debarment: [Empty];
Monetary forfeiture[B]: [Empty];
Notice of violation: [Empty];
Closed; no action taken: 2,315;
Unable to determine if any action was taken: [Empty].
Type and number of investigations: Audits of certification-based
facilities (1,965);
Admonishment and warning: 189;
Citation: [Empty];
Consent decree: [Empty];
Debarment: [Empty];
Monetary forfeiture[B]: 72;
Notice of violation: 92;
Closed; no action taken: 1,612;
Unable to determine if any action was taken: [Empty].
Type and number of investigations: Emergency Alert System requirements
(1,533);
Admonishment and warning: 230;
Citation: [Empty];
Consent decree: [Empty];
Debarment: [Empty];
Monetary forfeiture[B]: 53;
Notice of violation: 69;
Closed; no action taken: 1,181;
Unable to determine if any action was taken: [Empty].
Type and number of investigations: Due diligence (1,082)[C];
Admonishment and warning: [Empty];
Citation: [Empty];
Consent decree: [Empty];
Debarment: [Empty];
Monetary forfeiture[B]: [Empty];
Notice of violation: [Empty];
Closed; no action taken: 365;
Unable to determine if any action was taken: 717.
Type and number of investigations: Other general enforcement
(1,079)[D];
Admonishment and warning: 34;
Citation: 3;
Consent decree: [Empty];
Debarment: [Empty];
Monetary forfeiture[B]: 5;
Notice of violation: 6;
Closed; no action taken: 1,031;
Unable to determine if any action was taken: [Empty].
Type and number of investigations:
Admonishment and warning: 98;
Citation: 7;
Consent decree: [Empty];
Debarment: [Empty];
Monetary forfeiture[B]: 6;
Notice of violation: 142;
Closed; no action taken: 769;
Unable to determine if any action was taken: [Empty].
Type and number of investigations: All other investigations[E] (9,800);
Admonishment and warning: 698;
Citation: 124;
Consent decree: 50;
Debarment: 10;
Monetary forfeiture[B]: 88;
Notice of violation: 77;
Closed; no action taken: 6,394;
Unable to determine if any action was taken: 2,348.
Type and number of investigations: Total (38,786);
Admonishment and warning: 1,790;
Citation: 356;
Consent decree: 135;
Debarment: 10;
Monetary forfeiture[B]: 339;
Notice of violation: 744;
Closed; no action taken: 32,237[F];
Unable to determine if any action was taken: 3,164.
Source: GAO analysis of Enforcement Bureau's databases.
Note: The information in this table was derived entirely from our analysis
of FCC's Enforcement Bureau's databases.
^aIn addition to the enforcement actions listed in this table, the
Enforcement Bureau took four civil/ criminal actions and seven equipment
seizures.
^bMonetary forfeiture also includes notice of apparent liability actions.
^cAccording to an Enforcement Bureau official, due diligence, though
included in its databases, is not an investigation. Due diligence refers
to a request made to the Enforcement Bureau for information concerning
matters pending before the Bureau that might adversely impact a proposed
transaction with a station or company.
^dFCC did not provide us with a definition for investigations it referred
to as other general enforcement.
^eAll other investigations includes, for example, Freedom of Information
requests, Universal Service Fund, unlicensed and unauthorized operations,
sponsorship identification, and unauthorized equipment enforcement.
^fThis figure does not include 283 proceedings closed by the Market
Disputes Resolution Division.
In its written comments FCC said that figure 5 and table 2 in our report
understate or inaccurately state information about its enforcement record
or systems. As such, FCC conducted its own analyses and provided us with
the results of these analyses. However, while FCC did not provide its
methodology, its overall approach differs significantly from the approach
we used. Based on discussions with FCC officials, we analyzed the
variables from its databases that contained information on enforcement
actions and that could be searched for codes indicating particular types
of actions, such as "citation" or "monetary forfeiture." We worked
extensively with these officials to ensure that we searched for all of the
appropriate codes for enforcement actions. However, in its comment letter,
FCC acknowledged that it had to review about 46,000 paper case files and
use its databases to determine the reasons why investigations were closed
with no enforcement action. FCC also acknowledged that it conducted a
manual review of a variable in its database that we could not use because
of reliability concerns. As noted in our report, the data that we used for
our analyses are derived directly from FCC's databases. We did not review
the 46,000 paper case files that FCC maintains. Our focus was on the
database systems for FCC's enforcement program. We continue to believe
that FCC should have data management systems that will allow it to
generate this type of information automatically, reliably, and regularly.
According to FCC, it assessed fines and negotiated payments through
consent decrees, which totaled about $73 million from 2003 through 2006,
and has collected about $53 million, or 72 percent. However, as shown in
figure 6, the amount of the fines and payments negotiated through consent
decrees decreased, from about $25 million in 2003 and $26 million in 2004,
to almost $11 million in 2005 and $12 million in 2006--a decrease of more
than 50 percent. According to an Enforcement Bureau senior official, the
phasing out of section 271 complaints may have contributed to this
decrease.^19 FCC staff also stated that the amount of fines and negotiated
payments through consent decrees totaled about $43 million in 2007.
Figure 6: Amount of Monetary Forfeitures Assessed and Payments Negotiated
through Consent Decrees, Calendar Years 2003 through 2006
At the end of December 2006, the Enforcement Bureau had almost 7,200
investigations that were pending resolution, as shown in figure 7. About
81 percent, or about 5,800, were pending for less than 1 year, and 19
percent, or almost 1,400, were pending from about 1 to 4 years. About 46
percent of the pending investigations were related to potential indecency
violations, and about 800 of them remained open for more than 1 year.
According to FCC, litigation has delayed resolution of many indecency
investigations.^20
^19Under section 271 of the Communications Act of 1934, as amended, the
Bell Operating Companies (BOC) needed to file applications with FCC on a
state-by-state basis in order to provide in-region, interLATA services. In
2002, the Enforcement Bureau set up a Section 271 Compliance Review
Program for each newly filed section 271 application. As of December 3,
2003, the Commission had granted all of the BOCs section 271 authorization
for the provision of in-region, interLATA services in all of the BOCs'
territories nationwide.
Figure 7: Number of Years Enforcement Bureau Investigations Were Pending,
as of December 31, 2006
It is difficult to fully determine the reasons why the trends we
identified occurred. FCC officials were not able to explain or provide
documentation on why the number of complaints, investigations, and
enforcement actions fluctuated from 2003 through 2006. While we were able
to use FCC enforcement data to identify some overall trends, FCC had not
systematically identified trends related to enforcement issues associated
with its overall mission, and we were not able to use the data to
determine why the trends occurred. Apart from providing requested
information for our analysis of FCC's enforcement data, the Enforcement
Bureau has taken few steps to analyze the Commission's existing data to
determine the reasons for the fluctuations in complaints received,
investigations conducted, and enforcement actions taken. FCC has not
systematically analyzed its existing enforcement data to identify factors
that might account for the year-to-year fluctuations we found in the data.
While FCC has an array of enforcement actions that it may take, performing
this type of analysis may help in assessing the effectiveness of the
enforcement program and the utility of FCC's enforcement actions.
^20Fox Television Stations, Inc. v. FCC, 489 F.3d 444 (D.C. Cir. 2007),
petition for cert. filed, No. 07-582, 2007 Westlaw 3231567 (Nov. 1, 2007);
Complaints Against Various Television Licensees Concerning Their February
1, 2004 Broadcast of the Super Bowl XXXVII Halftime Show, pet. for rev.
pending sub nom. CBS Corp. v. FCC, No. 06-3575 (3d Cir. Filed July 28,
2006).
FCC's Enforcement Bureau Assesses Some Program Outputs, but Lacks Key Management
Tools to Measure Outcomes and Manage Its Program
FCC's Enforcement Bureau periodically reviews some of its enforcement
program outputs to determine how well it is doing in certain areas but
does not use its data to evaluate the outcomes of its enforcement efforts.
The Enforcement Bureau's ability to assess the impact of its enforcement
program is limited because it does not have a well-defined enforcement
strategy, specific enforcement goals, or performance measures. We have
previously reported that a key element in an organization's efforts to
manage for results is its ability to select meaningful performance goals
and measures. Without these key management tools, FCC faces challenges in
managing its enforcement program and in fully assuring Congress and other
stakeholders that it is meeting its enforcement mission and related
objectives of the Act, which include protecting the consumer, ensuring
public safety, and encouraging competition.
FCC's Enforcement Bureau Measures Outputs Rather Than Outcomes
FCC has focused on measuring the outputs of its enforcement program and
not on measuring outcomes or the net effect of its program. For example,
Enforcement Bureau officials told us that two measures they use to
determine how well they are doing are whether they have met the statute of
limitations for monetary forfeitures and how long it takes to close a
case. However, Enforcement Bureau officials told us that to prepare
written reports on these two output measures, data must be compiled from
several different databases, as well as from a manual search of thousands
of paper case files. In addition, each of the Enforcement Bureau's five
divisions described a different method for measuring its performance. For
example, three divisions (Spectrum Enforcement, Investigations and
Hearings, and the Field Offices) told us they know their actions are
effective because they handle 100 percent of the complaints they receive.
The Telecommunications Consumer Division generally assesses its
effectiveness on a case-by-case basis through staff dialogue, and the
Market Disputes Resolution Division measures its effectiveness by the
percentage of proceedings, that meet statutory deadlines, and the amount
of time taken to close cases.
While measures of outputs are useful, measures of outcomes are also
important because they can provide FCC with broader information on program
results, such as the extent to which its current enforcement efforts are
contributing to higher compliance rates or fewer repeat violations or
whether other types of enforcement action may be needed to deter
noncompliance. Currently, FCC's Enforcement Bureau conducts limited
analyses of its enforcement data. For example, the Enforcement Bureau
monitors the amount of time it takes to close an investigation, but it
does not measure the effect of one of its key enforcement tools--monetary
forfeitures--on companies' compliance with telecommunications laws and
Commission rules. Without this information, it is difficult for FCC to
make sound decisions about how this program might be made more effective.
In addition, FCC created the Enforcement Bureau in 1999 because it wanted
to enhance the Commission's ability to serve the public by improving the
effectiveness of the enforcement program. However, FCC has not analyzed
the impact of this new organizational structure to determine if it is more
effective and efficient than the previous decentralized structure, under
which several bureaus were responsible for enforcing telecommunications
laws and Commission rules. According to Enforcement Bureau officials, they
believe that centralizing enforcement efforts has been effective because
it has enabled the bureau to establish standard procedures across all
issue areas, resulting in more consistent and effective enforcement, and
has also brought greater visibility and importance to the enforcement
function. As a measure of the program's effectiveness, Enforcement Bureau
officials pointed out that the efforts of the bureau have garnered
headlines in the mainstream press and have been cited by a wide range of
citizens and industry participants.
We asked several stakeholders, including telecommunications company
executives and telecommunications experts, for their views on the impact
of FCC's enforcement efforts.^21 Eleven of the fifteen executives we
interviewed stated that they believe FCC's enforcement program is having
an impact on the telecommunications industry, and four of the five experts
we interviewed said they thought FCC was having a positive effect on the
telecommunications industry. For example, one expert stated that FCC is
doing a good job, particularly in protecting consumers; another said that
the Enforcement Bureau has had an impact on reducing intentional
interference and ensuring public safety; and a third said that FCC's
Enforcement Bureau has been effective in working with the states to
address slamming and cramming issues. However, all five experts and 9 of
the 15 executives we interviewed were also critical of FCC's enforcement
efforts. The 9 executives said that FCC's enforcement decisions are not
always equitable, and 6 of the 9 stated that FCC's enforcement actions
were not always transparent. For example, 1 executive said that the use of
consent decrees lacked both transparency and equity because there was no
indication as to how the final result was determined and parties to the
consent decree did not know how prior consent decrees involving the same
alleged violation were handled. Another executive told us that the focus
of FCC's investigations appeared to be arbitrary and based on the issues
of the moment, resulting in inequitable enforcement actions. One expert
stated that whenever FCC makes an enforcement decision, there is always
the possibility that negotiations behind the scenes are not subject to
public review.
^21As our sample size was small and nongeneralizeable, the views we
obtained may not be representative of all stakeholders. However, we asked
experts and company representatives about similar issues.
FCC's Enforcement Bureau Has Not Fully Defined Its Strategy and Has No Specific
Goals or Performance Measures
FCC's Enforcement Bureau has not fully defined its strategy for carrying
out its enforcement of consumer protection, public safety, and competition
laws and rules. FCC's Web site states that "the Enforcement Bureau is the
primary organizational unit within the Federal Communications Commission
that is responsible for enforcement of provisions of the Communications
Act, the Commission's rules, Commission orders and terms and conditions of
station authorizations." However, FCC's Strategic Plan for 2006 through
2011, Fiscal Year 2006 Performance and Accountability Report, and Fiscal
Year 2006 Congressional Justification of Estimates do not identify
specific enforcement goals or performance measures linked to those goals
that would allow a complete assessment of the results of FCC's enforcement
program.^22 In addition, while the Enforcement Bureau has an enforcement
manual that provides general guidance on conducting investigations, the
various types of enforcement actions it can take, and how each should be
used, the manual does not specify enforcement goals or priorities relating
to consumer protection, public safety, and competition.
^22According to an FCC official, while the Enforcement Bureau does not
have outcome goals, it does have some output goals. As an example of FCC's
output goals, the official provided us with a copy of a March 31, 2006,
letter sent to the Chairman, Subcommittee on Commerce, Justice, Science,
and Related Agencies, House Committee on Appropriations. In response to
questions from the Chairman, FCC wrote that the Commission attempts to
resolve public safety interference complaints within 1 day, nonemergency
interference complaints within 1 month, indecency complaints within 9
months, formal complaints within 1 year, and all other investigations and
complaints within 15 months.
Federal agencies are required to develop strategic plans with long-term,
outcome-oriented goals and objectives, annual goals linked to achieving
the long-term goals, and annual reports on the results achieved.^23 An
analysis of FCC's Strategic Plan for 2006 through 2011, Fiscal Year 2006
Performance and Accountability Report, and Fiscal Year 2006 Congressional
Justification of Estimates shows that, although there are strategic goals
for FCC, there are no strategic or performance goals pertaining to the
Enforcement Bureau. For example, in its Strategic Plan for 2006 through
2011, FCC lists goals in six categories: broadband, competition, spectrum,
media, public safety and homeland security, and FCC modernization. Each of
these strategic goals is supported by a number of objectives showing how
FCC will meet these goals. Several of the objectives include the term
"enforcement," such as the objective that states, "the Commission shall
vigorously enforce its spectrum regulations and policies," but there are
no specific or measurable enforcement actions indicated. The Fiscal Year
2006 Performance and Accountability Report also illustrates the lack of
specific performance measures relating to enforcement. In the section on
program performance, there are performance goals for each of the six
strategic goals. While some of these performance goals do include the term
"enforcement," such as in the statement "enforce the Commission's rules
for the benefit of consumers," no specific, measurable actions are listed.
Additionally, in the Fiscal Year 2006 Congressional Justification of
Estimates, FCC uses a performance measure scorecard to identify its
activities of the past year in support of each of its six strategic goals.
One of the activities in support of homeland security is to "enforce
technical regulations and investigate harmful interference complaints
affecting public safety communications systems and infrastructure." FCC
rated itself as having met this goal, although there are no specific
actions listed and no indication of how much activity is required for FCC
to meet the goal.
Enforcement Bureau officials told us that the bureau has not set specific
goals and performance measures because its priorities are constantly
changing. Officials explained that the Enforcement Bureau is responsive to
a number of stakeholders--Congress, Commissioners, the public--and the
priorities of those stakeholders change. In addition, the Enforcement
Bureau is responsible for enforcing a wide range of rules and issues, and
current enforcement priorities may not be future enforcement priorities.
For example, according to an FCC official, issues regarding the transition
to digital television have become a high priority, but after February
2009, when the transition takes place, these issues will no longer be as
significant. However, we found that the Enforcement Bureau had specific
enforcement goals and performance measures in the past. For example, in
its fiscal year 2004 annual performance plan, FCC specified the following
performance goals relating to enforcement and stated that it met these
goals:
^23Pub. L. No. 103-62, 107 Stat. 285.
o achieve a 10 percent reduction in the number of long-distance
slamming complaints in 2000, a 20 percent reduction in 2001, and a
40 percent reduction in 2002;
o achieve 65 percent compliance with new disability rules in 2000,
80 percent compliance in 2001, and 85 percent compliance in 2002;
and
o achieve 85 percent compliance with antenna lighting rules in
2000, 90 percent compliance in 2001, and 92 percent compliance in
2002.
The Federal Trade Commission (FTC), which shares responsibility with FCC
for consumer protection against violations of the do-not-call list request
and telemarketing fraud, has developed goals and performance measures to
assess the results of its enforcement program. For example, one of FTC's
strategic goals is to maintain competition by identifying and taking
enforcement action against anticompetitive mergers and practices that
cause the greatest injury to consumers. In support of this goal, they have
established performance measures, one of which is to achieve a positive
result in at least 80 percent of the cases in which the FTC takes
enforcement action each year. According to FTC officials, setting specific
goals and performance measures allows them to target their enforcement
activities and more efficiently use their limited resources.
Goals and Performance Measures Are Key Elements of Effective Management
We have previously reported that a key element in an organization's
efforts to manage for results is its ability to set meaningful performance
goals and measures and agencies should create a set of performance goals
that address key aspects of program performance. We and other federal
agencies have also maintained that adequate and reliable performance
measures are a necessary component of effective management. ^24 We have
also found that performance measures should provide agency managers with
timely, action-oriented information in a format conducive to helping them
make decisions that improve program performance, including decisions to
adjust policies and priorities.^25 However, FCC does not appear to be
using these key management practices to manage the work of its Enforcement
Bureau.
In 2006, we recommended that FCC develop goals and performance measures
for its program pertaining to the enforcement of junk fax rules. FCC has
told us it is in the process of implementing some of those
recommendations. For example, in 2006, we found that FCC's Enforcement
Bureau did not have goals or performance measures for junk fax monitoring
and was not performing any analysis of complaint and enforcement data,
making it impossible to explore the effectiveness of their current
enforcement measures.^26 FCC acknowledged the need for such measures and,
in July 2007, told us it had begun drafting such goals and performance
measures. The Commission has also recognized the need for more data to
measure performance, as indicated by a directive from FCC's OMD issued in
May 2007. This directive outlines FCC's plans to begin collecting and
analyzing data to measure the performance of Commission programs that
involve the processing of applications or other filings from the public or
other private entities. An Enforcement Bureau official told us that the
bureau will respond to this directive by gathering data that could be used
to help FCC better manage its enforcement program. Although these efforts,
when completed, will begin to address the Enforcement Bureau's lack of
specific program goals and performance measures, the Enforcement Bureau
will not have goals or performance measures for several of its divisions,
such as the Investigations and Hearings Division or the Market Disputes
Resolution Division. Without goals, a well-defined enforcement strategy,
and performance measures linked to those goals, the Commission lacks
important tools for assessing and reporting on the progress of its
enforcement program and determining whether changes should be made.
^24GAO, Results-Oriented Government: GPRA Has Established a Solid
Foundation for Achieving Greater Results, [22]GAO-04-38 (Washington, D.C.:
Mar. 10, 2004); GAO, Managing for Results: Strengthening Regulatory
Agencies' Performance Management Practices, [23]GAO/GGD-00-10 (Washington,
D.C.: Oct. 28, 1999); and GAO, Agency Performance Plans: Examples of
Practices That Can Improve Usefulness to Decisionmakers,
[24]GAO/GGD/AIMD-99-69 (Washington, D.C.: Feb. 26, 1999).
^25GAO, Pipeline Safety: Management of the Office of Pipeline Safety's
Enforcement Program Needs Further Strengthening, [25]GAO-04-801
(Washington, D.C.: July 23, 2004).
^26GAO, Telecommunications: Weaknesses in Procedures and Performance
Management Hinder Junk Fax Enforcement, [26]GAO-06-425 (Washington, D.C.:
Apr. 5, 2006).
FCC disagreed with our finding that it has no specific enforcement goals
or performance measures. In its comments, FCC stated that its performance
goals for disposing of complaints are 1 day for public safety interference
complaints, 1 month for nonemergency interference complaints, and 9 months
for indecency complaints. We view FCC's efforts to collect, track, and
report data for such goals as first steps toward performance management,
and we encourage FCC to ensure that it consistently includes this
information in its future Performance and Accountability Reports. However,
as we state in our report, such goals are measures of outputs and are
useful as indicators of program activities, but measures of outcomes, such
as the extent to which FCC's current enforcement efforts are contributing
to higher compliance rates or fewer repeat violations may be more
important because they can provide FCC with broader information on program
results.
An Inadequate Data Management System Challenges the Enforcement Bureau's Ability
to Carry Out Its Responsibilities
Limitations with FCC's current approach for collecting and analyzing
enforcement data challenge the ability of the Enforcement Bureau to carry
out its enforcement responsibilities, making it difficult for the bureau
and others to determine the enforcement program's effectiveness or for the
bureau to accurately track and monitor data on complaints received,
investigations conducted, and enforcement actions taken. Currently, the
Enforcement Bureau uses several separate databases and manually searches
paper case files to track and monitor its enforcement activities.
Consequently, we could not use the Enforcement Bureau's databases to
obtain bureau-level information on the percentage of monetary forfeitures
assessed within FCC's statute of limitations, the speed with which FCC
disposed of complaints, the reasons for closing investigations with no
enforcement action, or the amounts of the fines FCC assessed. Our past
work has shown that when data management systems are not integrated and
compatible, excessive use of resources and inconsistent analyses of
program results can occur.
The Enforcement Bureau has five databases, one for each of its five
divisions. However, these databases are not standardized and do not track
the same information in the same manner. FCC officials explained that when
the Enforcement Bureau was created in 1999, it inherited these databases
from the various bureaus and, partly because of budget constraints,
cobbled them together rather than create a single, standardized, automated
data management system. These officials acknowledged that the databases
have limitations and were created only to manage staff workload, not to
track the history of cases or measure performance.^27
While the Enforcement Bureau's databases do contain some information, our
analysis of their files indicates that this information is not sufficient
to measure certain important aspects of FCC's enforcement program. For
example, when we tried to determine whether FCC met the statute of
limitations for assessing monetary forfeitures, we could not determine how
many cases the Enforcement Bureau resolved within the statutory deadline
because the databases did not contain sufficient information.
Specifically, the Investigations and Hearings Division's database was
missing 84 percent, the Telecommunications Consumers Division's database
was missing 99 percent, and the Spectrum Enforcement Division's database
was missing 99 percent of the information needed to determine whether FCC
met the statute of limitations for assessing monetary forfeitures. Of the
remaining two databases, one (for Field Offices) would allow the statutory
deadline to be determined for investigations that were closed with an
enforcement action, but not for investigations that were closed with no
enforcement action because the database does not include a field for the
date of the alleged violation. The other database is managed by the Market
Disputes Resolution Division; according to Enforcement Bureau officials,
the majority of the division's investigations do not have a statute of
limitations involving forfeitures, and the database does not have a field
for this information.^28
We were also unable to determine how long it took the Enforcement Bureau
to open and close investigations for three of its five divisions because
of how the required information is entered into the databases. Enforcement
Bureau personnel did not always enter the dates into the database and,
when a date was entered, it was not always clear what the date
represented. For example, it was unclear whether the date entered was the
date of the initial or the final enforcement action. More specifically,
according to one Investigations and Hearings Division official, it would
be difficult to calculate the speed of disposal times for investigations
in its database because entering the date when an investigation was closed
was not always a priority for the division and its database does not track
all milestones in an investigation. While the Spectrum Enforcement
Division's database has fields for opening and closing dates, we were not
able to calculate the speed of disposal because we could not always
determine what the closing date represented. According to Enforcement
Bureau officials, the Telecommunications Consumers Division's database
cannot determine the speed of disposal for investigations because some
investigations tracked in the database have been closed at one point with
an enforcement action but have subsequently been reopened to consider the
next stage of enforcement. This reopening affects both the number of
enforcement actions tracked in the database and the speed of disposition.
In addition, cases that were initially closed but then reopened, and left
pending for some time after being reopened, would be tracked back to the
initial date and would appear to have taken a long time to close. As a
result, data for such cases would skew calculations of the average speed
of disposition for all of the Telecommunications Consumers Division's
enforcement actions.
^27According to an FCC official, the Commission is planning to spend $2
million to improve its existing systems for receiving, processing, and
enforcing consumer telemarketing complaints alleging violations of junk
fax and do-not-call list request but has not finalized its plans to
improve the Enforcement Bureau's databases.
^28FCC may choose to initiate a forfeiture proceeding separate and apart
from a formal 208 complaint proceeding. The complainant would not be a
party to such a forfeiture proceeding.
We were also unable to use the Enforcement Bureau divisions' databases to
determine the amounts of the fines the bureau had assessed, the amount
collected, or the status of the uncollected amount. We could not determine
this information because several of the database fields relating to fines
either were missing information or did not contain sufficient information
to allow for data analysis.^29 For example, while the Investigations and
Hearings Division's database tracks the amounts of the fines assessed, the
information is not consistently entered into the database and there are no
distinct fields for the amounts initially assessed, reduced, collected, or
outstanding. In addition, we found that the database used by the
Telecommunications Consumers Division had a table for tracking fines, but
data were not entered into the table consistently. FCC officials told us
that they could generate information on fines and other aspects of the
agency's enforcement program by manually searching thousands of paper
files.
Finally, during the course of our review, we could not use FCC's databases
to determine how many of the 32,200 investigations that were closed with
no enforcement action from 2003 through 2006 were closed because no
violation was found, because of insufficient information, because the
statute of limitations had expired, or because of other reasons. We were
not able to make this determination because FCC did not collect the
information systematically, which hampered our ability to analyze its
enforcement efforts. Specifically, we found that the Investigations and
Hearings and the Telecommunications Consumers Divisions' databases did not
clearly indicate whether a case was closed because no violation was found
or because of other reasons. The Spectrum Enforcement Division entered
some information specific to why investigations were closed with no
enforcement action in text fields, but the information was not entered in
a way that would allow for quantitative analysis. While the Field Office
database allows for some determination of when investigations were closed
with no enforcement action, we had to follow up with Field Office
officials to obtain the specific reasons. In addition, we could not use
the database to determine why the majority of their investigations were
closed with no enforcement action. According to Field Office officials,
the majority of their investigations do not result in an enforcement
action because, generally, no Commission rules were violated. For FCC to
analyze the 83 percent of investigations that did not result in an
enforcement action, it would have to (1) access files for all of those
cases, (2) ensure that the files contained sufficient information for a
reviewer to reconstruct the reasons for no action, and (3) establish and
implement procedures that would ensure consistency and accuracy in the
review. FCC could also review a statistical sample of the cases in which
no action was taken, rather than the entire universe of such cases. The
review procedures should include clear guidance for reviewers to
categorize the reasons for no action and provide a means for checking the
accuracy and consistency of the reviewers.
^29The Market Disputes Resolution Division does not impose fines.
Conclusions
The extent to which FCC is effectively enforcing the Communications Act of
1934, as amended, and Commission rules and orders is difficult to assess
because it lacks a robust data management system, as well as performance
goals and measures. For example, a more robust data management system for
monitoring complaints, investigations, and enforcement actions is critical
for the agency to better understand the outcome and net results of its
enforcement efforts. In past reports, we have discussed the importance of
maintaining timely and accurate data to help monitor and improve the
effectiveness of government programs. We have found that, in order to make
informed decisions and ensure accountability, agencies need data
management systems that can generate timely, accurate, and useful
information. Lacking such critical information, government leaders are not
able to invest resources where they are needed, reduce costs, or fully
oversee programs; they are also unable to hold agency managers accountable
for the outcomes of government programs. We also found that agencies that
do not have integrated data management systems are more likely to devote
more time and resources to collecting information than those with
integrated systems and that opportunities for errors increase when agency
systems are not compatible.
Moreover, beyond our analysis of FCC's enforcement data, there have been
limited efforts to analyze the Commission's existing data to identify
trends and determine the reasons for the year-to-year fluctuations in the
number of complaints received, investigations conducted, and enforcement
actions taken. FCC has not systematically analyzed its existing data to
identify factors that might account for these fluctuations and to assess
their implications for the enforcement program. As demonstrated by our
analysis of FCC's enforcement data, the Commission does have some
information available, despite data limitations, to analyze enforcement
outputs and outcomes in a manner that could provide more reliable, useful,
and timely information for managing its day-to-day operations and to make
more informed decisions about its enforcement efforts. In addition,
improvements in existing data management could make this type of analysis
more useful and could enhance FCC's ability to provide Congress and other
stakeholders with accurate and timely information on its enforcement
program. This information could also help the Enforcement Bureau determine
whether different policy options might be more effective in implementing
the enforcement program.
The extent to which the Enforcement Bureau is achieving its mission is
difficult to determine because the bureau does not use several important
performance management tools. FCC's Enforcement Bureau has not set
specific enforcement goals, developed a well-defined strategy for
achieving those goals, or established performance measures linked to
goals. Performance measures of program results are important for several
reasons. First, they can help hold agencies accountable for the
performance of their programs. Among other things, measures of enforcement
results may help FCC allocate limited resources where they are most needed
and determine if rules and procedures should be changed to deter potential
violators. Second, Congress needs information on program results to
support its oversight of agencies and their budgets. Third, stakeholders
can use this information to accurately judge program effectiveness.
Recommendations for Executive Action
To develop a more effective approach to enforcing telecommunications laws
and Commission rules, we recommend that the Chairman of the Federal
Communications Commission
o improve how FCC collects and analyzes data on complaints
received, investigations conducted, and enforcement actions taken
to help it better manage and understand the outcomes and net
results of enforcement efforts and to provide Congress and
stakeholders with timely and accurate information that can be used
to hold FCC's enforcement program accountable for accomplishing
its mission under the Act; and
o develop and implement additional performance management
practices, such as outcome measures, to assess the performance and
improve the accountability of FCC's enforcement program.
Agency Comments and Our Evaluation
We provided a draft of our report to FCC for review and comment. FCC
commented that it has already implemented measures that address both of
our recommendations, but it provided no supporting documentation. In
addition, FCC disagreed with our methodology and several of our findings.
FCC's detailed comments appear in appendix II. FCC also provided over 100
pages of attachments in its comments. Because these attachments cover time
periods that are after the scope of our audit and are voluminous, we have
decided to characterize the attachments rather than include them in their
entirety.^30 FCC also provided technical and legal clarifications, which
we incorporated as appropriate. In appendix I, we also clarified our
methodology for analyzing FCC's databases. These technical and legal
changes did not affect our findings, conclusions, or recommendations.
In FCC's view, it has already implemented measures that address both of
our recommendations. Concerning our first recommendation, FCC said that
during the period of our audit (2003 through 2006), the Commission was
already aware of the challenges posed by its limited information systems
and database management resources and already had plans in place to
improve its enforcement data collection methods and process. By July 2007,
FCC said, the Commission had secured congressional approval to make
significant modifications to the databases and systems used to support its
enforcement activities. Concerning our second recommendation, FCC noted
that it has implemented standardized enforcement performance goals to
better manage the enforcement process and to automate portions of this
process. Moreover, according to FCC, goals and measures for managing the
enforcement process have been incorporated for the first time into the
performance plans of the senior executives responsible for oversight of
the enforcement program and that information about these efforts is
included in the Commission's Fiscal Year 2007 Performance and
Accountability Report. Finally, FCC said that we based our conclusions and
recommendations on significantly outdated information and that our report
contains several errors. As a result of these errors, FCC said, our report
provides a misleading description of FCC's current enforcement processes,
understates or inaccurately states information about FCC's enforcement
record or systems, and provides an incomplete and misleading picture of
FCC's legal enforcement environment.
^30Generally accepted government auditing standards do not require us to
print responses submitted by an agency in connection with our reports in
their entirety and allows us to characterize responses where suitable, and
to include or not to include responses as appropriate.
We are pleased that FCC may be taking some steps toward implementing our
recommendations, but we disagree with FCC that it has already fully
implemented them; we also disagree with FCC's criticisms of our
methodology and findings. We believe that our report provides an accurate
and sufficient overview of FCC's processes for handling complaints,
conducting investigations, and taking enforcement actions and the results
of FCC's efforts to enforce telecommunications laws and the Commission's
rules from 2003 through 2006. We also exercised the due diligence in
writing our report to ensure we explained that the results of our analysis
are based entirely on FCC's databases. In our view, FCC's concerns about
the accuracy of our findings stem from (1) the challenges FCC faces in not
having a data management system that will allow it to systematically
collect and analyze information about complaints, investigations, and
enforcement actions and (2) the Commission's use of an approach that
differs significantly from ours. We discuss the challenges posed by FCC's
data management system in our report and point out that without
improvements such as we recommend, FCC cannot readily analyze trends,
determine program effectiveness, allocate Commission resources, or
accurately track and monitor key aspects of all complaints received,
investigations conducted, and enforcement actions taken. In addition, the
Commission's use of data for 2007 and data from paper case files, both of
which were outside the scope of our analysis, necessarily led to findings
that differed from ours. These differences, however, do not affect the
appropriateness of our methodology or the accuracy of our findings.
In commenting that it has already implemented our first recommendation--to
improve how it collects and analyzes data on complaints received,
investigations conducted, and enforcement actions taken--FCC stated that
its Managing Director wrote Congress on June 27, 2007, asking for approval
to upgrade its databases and that FCC expected the final delivery of
system enhancements this year. While we are pleased that FCC has taken
this step, on July 26, 2007, the Chief of FCC's Enforcement Bureau stated
that the funds would be used to enhance CGB's database for processing junk
fax and do-not-call list request complaints and that FCC has no specific
plans or time frames for upgrading the Enforcement Bureau's databases. In
its comments, FCC did not provide any additional information that changes
our understanding of the Enforcement Bureau's plans to upgrade it
databases systems. Thus, it is not apparent to us how enhancements to
CGB's database will address the weaknesses with the Enforcement Bureau's
databases. Therefore, we do not believe that FCC has yet fully implemented
our first recommendation.
In commenting that it has already implemented our second
recommendation--that it develop and implement performance management
practices for the Enforcement Bureau, such as a well-defined enforcement
strategy that includes specific goals and performance measures--FCC cited
its implementation of standardized enforcement performance goals, its
incorporation of enforcement goals and measures in the performance plans
of its senior executives responsible for enforcement oversight, and its
inclusion of this information in its Fiscal Year 2007 Performance and
Accountability Report. The performance goals that FCC cited for disposing
of complaints are 1 day for public safety interference complaints, 1 month
for nonemergency interference complaints, and 9 months for indecency
complaints. We view FCC's efforts to collect, track, and report data for
such goals as first steps towards performance management, and we encourage
FCC to ensure that it consistently includes this information in its future
Performance and Accountability Reports. However, as we state in our
report, such goals are measures of outputs and are useful as indicators of
program activities, but are not measures of outcomes, such as the extent
to which FCC's current enforcement efforts are contributing to higher
compliance rates or fewer repeat violations. These outcome measures are
necessary to determine a broader perspective on program results. Thus,
while FCC has begun to develop and implement performance management
practices, we believe that further efforts are needed for FCC to fully
implement our recommendation.
FCC disagreed with our methodology and our findings, conducted its own
analyses, and included the results of these analyses in attachments to its
comments. According to FCC, its results are more accurate than ours. We
disagree and believe that our results represent an accurate analysis of
the relevant information in FCC's databases. Whereas we used data only
from FCC's databases, FCC used information from both its databases and its
approximately 46,000 paper case files. In addition, because FCC's
databases are frequently updated and it analyzed data a year after we
received our data, we believe this could have contributed to the
differences in our results. As part of our routine recommendation
follow-up work, we will assess FCC's progress in 2007.
According to FCC, the data for 2003 through 2006 that we used are out of
date. However, these are the most recent data for complete years that were
available to us at the time of our review. In conducting our audit work,
we often select data for the last 3 or 4 years to analyze because it
allows us to ensure the consistency and integrity of the data, identify
trends, and understand information over time. We initially designed our
analysis to cover a longer time period and requested data from FCC for
2000 through 2006, but FCC was not able to provide us with CGB's data from
2000 through 2003 because data prior to 2003 had been purged from its
files. To be consistent in our reporting, we analyzed data from CGB and
the Enforcement Bureau for the same time period, 2003 through 2006.
FCC also stated that our report does not acknowledge or assess its new
process for handling consumer complaints. We disagree. Our description of
FCC's process for responding to consumer complaints is based on
information it provided to us during the course of our review. During the
course of our review, FCC stated that it planned to change its process for
responding to consumer complaints. However, FCC did not provide any
documentation explaining how or when. Thus, we were not able to evaluate
any changes that FCC may have made to it process for responding to
consumer complaints.
FCC also disagreed with our finding that 83 percent of its investigations
were closed with no enforcement actions and that there were no
justifications for these closures in its databases. In its comments, FCC
stated that its analysis of its databases and paper case files showed that
85 percent of its investigations were closed with no enforcement actions
and 96 percent of these closures were due to findings of compliance or
insufficient information from the complainant. To determine the reasons
why investigations were closed, we attempted to identify a reliable
variable in FCC's enforcement database that clearly categorized the
justifications for closing an investigation with no enforcement action. No
such variable exists. As an alternative, FCC referred us to open-ended
text variables in the course of our audit work. We reviewed these
variables, and in June 2007, told FCC officials that we could not use
these variables because many of the database fields were frequently blank
or, if completed, contained varying amounts of text to justify the actions
or lack thereof. While such information may be useful to the FCC analysts
working on the investigations, they are not useful or usable for
management information purposes. In addition, as FCC acknowledged in its
comments, to determine the reasons why its investigations were closed with
no enforcement action, it had to use approximately 46,000 paper case
files. As noted in our report, the data that we used for our analysis are
derived entirely from FCC's databases. We did not review the 46,000 paper
case files that FCC maintains. Our focus was on the database systems for
FCC's enforcement program. FCC also acknowledged that it conducted a
manual review of a variable that indicated enforcement action codes we
could not search with any reliability. While our analyses are accurate
based on the database variables we analyzed, we acknowledge that they do
not account for information that FCC retained in paper case files and did
not enter into its databases or for information that was entered in data
fields that we could not search with our computer routines. Our
understanding is that FCC analysts reviewed the information from its
databases and paper case files and categorized the reasons for
approximately 46,000 investigations after we conducted our initial
analysis. We believe that FCC should have data management systems that
allow it to generate this type of information automatically, reliably, and
regularly. Therefore, we stand by our recommendation that FCC needs to
improve how it collects and analyzes data on complaints received,
investigations conducted, and enforcement actions taken because we do not
believe that managing a program by reviewing 46,000 paper case files
constitutes a good management practice.
Finally, we continue to believe that the findings, conclusions, and
recommendations in our report are accurate and can improve how FCC manages
its enforcement program. We also believe that FCC will continue to have
difficulty providing Congress and other stakeholders with accurate and
timely information on its enforcement efforts if it does not take
additional steps to fully address our recommendations.
As agreed with your office, unless you publicly announce the contents of
this report earlier, we plan no further distribution of it until 30 days
from the date of this letter. At that time, we will send copies of this
report to the appropriate congressional committees and the Chairman of the
Federal Communications Commission. We will also make copies available to
others on request. In addition, the report will be available at no charge
on the GAO Web site at http://www.gao.gov.
If you or your staff have any questions, please contact me at (202)
512-2834 or [27][email protected] . Contact points for our Offices of
Congressional Relations and Public Affairs may be found on the last page
of this report. GAO staff who made major contributions to this report are
listed in appendix III.
Sincerely yours,
Mark L. Goldstein
Director, Physical Infrastructure Issues
Appendix I: Scope and Methodology
To summarize the number and types of complaints received, investigations
conducted, and enforcement actions taken by the Federal Communications
Commission (FCC) during calendar years 2003 through 2006, we obtained six
different databases from FCC in various formats. FCC's Enforcement Bureau
provided four Microsoft Access databases and one fixed-width delimited
text file, which had several text files linked by a single unique
identifier. FCC's Consumer and Governmental Affairs Bureau (CGB) also
provided a fixed-width delimited text file, which was a single `flat file'
that contained information on all complaints received from 2003 through
2006. The `flat file' contained all the information and there were no
other data files associated with it. When available, FCC also provided
data dictionaries, user guides, screen shots, and illustrations of how key
tables were linked for each database. Each of FCC's databases is
independent (meaning that they are not connected or related to one
another) and, therefore, the specific data elements contained in each one
differed. Additionally, when multiple databases contained the same data
element, it was often referred to or tracked differently.
We subsequently reviewed each database and file for consistency;
duplication; and missing identifiers, such as case number. We limited our
analysis to records that had an open date between calendar years January
1, 2003 and December 31, 2006. We excluded all cases in each database that
were received before 2003 and after 2006. We then sorted the data into
closed and pending cases. Closed cases had a closing date in the record
and were closed as of December 31, 2006. If a situation existed in which a
case had multiple records with varying dates, we always used the last
date. We also excluded any cases where the closing date was before the
opening date. Pending cases are cases that either did not have a closing
date or the closing date was after December 31, 2006. We also reviewed the
data dictionaries FCC provided to determine which fields contained the
data elements we planned to report on. We ran frequency distributions
using SAS software on all selected fields. These distributions provide
guidance as to whether the contents are complete enough for use. This
means that if a database has two similar fields such as Date Received and
Data Entry Date, we needed to know which of these fields is used most
frequently so that we could base our analysis on fields that are actually
used by FCC. For example, if the Date Received field was populated only 40
percent of the time and the Data Entry Date field was populated 99 percent
of the time, we used the Data Entry Date field. Based on this analysis, we
developed a list of fields we could use from each database. We compared
this list to the data elements we wanted to report on to determine the
extent to which we would be able to report data according to our initial
plan. We found that for three of the five Enforcement Bureau's databases
that are maintained by its Investigations and Hearings Division,
Telecommunications Consumers Division, and Field Offices, we could report
on the subject matter, the number of open and closed cases, and the
disposition of closed cases from 2003 through 2006. For one of the
remaining two databases, we were only able to report on the number of open
and closed cases from 2003 through 2006. The remaining database is
maintained by the Enforcement Bureau's Market Disputes Resolution
Division. This division does not conduct investigations; instead it
conducts proceedings which may result in FCC's issuance of an order to
resolve a dispute between two companies, rather than an enforcement
action. Thus, we are not including this database in our analysis.
We met with Enforcement Bureau officials to discuss the specific fields
that we were planning to use and the manner in which we were going to use
them. These officials agreed with the fields we had selected and
acknowledged the limitations we faced with its databases. We reached
agreement with Enforcement Bureau officials that for the Investigations
and Hearings Division, Telecommunications Consumers Division, and Field
Office databases we would report on the subject matter, the number of
opened and closed investigations, and the most recent action taken for the
closed investigations. Since the databases contained a large number of
subject matters and many options for disposition of closed cases, we
worked with Enforcement Bureau officials to combine the subject matters
and dispositions of cases for reporting purposes. For example, CGB's
database contained numerous subject matters for various types of billing
issues. Based on discussions with CGB officials, we combined all subject
matters related to billing into one subject matter called "Billing."
Based on our interviews with FCC and examination of its data, we
determined that certain variables in the databases were sufficiently
reliable for the purposes of this engagement. These variables allowed us
to identify closed cases and determine whether enforcement actions had
been taken, but did not allow us to determine the reasons for which
actions were taken. To determine whether enforcement actions were taken,
we analyzed the variables from FCC's databases. FCC officials told us that
these databases contained information on enforcement actions and could be
searched for codes indicating particular types of actions, such as
"citation" or "monetary forfeiture." We worked extensively with these
officials to ensure that we searched for all of the appropriate codes for
enforcement actions. We did not analyze the approximately 46,000 paper
case files that FCC maintains. Our focus was on the database systems for
FCC's enforcement program. We also did not analyze a lengthy text variable
that FCC indicated might contain some information on enforcement actions
because the information was entered in data fields that we could not
search with our computer routines. To determine why investigations were
closed with no enforcement actions, we attempted to identify a reliable
variable in FCC's enforcement database that clearly categorized the
justifications for closing an investigation with no enforcement action. No
such variable exists. As an alternative, FCC referred us to open-ended
text variables in the course of our audit work. We reviewed these
variables, and in June 2007, told FCC officials that we could not use
these variables because they were not analyzable. We also discovered that
some database fields were frequently blank or, if completed, contained
varying amounts of text to justify the actions or lack thereof. Thus, we
were not able to use the databases to determine why investigations were
closed with no enforcement action.
In addition, we interviewed officials from FCC's CGB about the
Commission's overall approach for enforcing telecommunications laws and
rules, as well as its specific processes for handling complaints,
conducting investigations, and taking enforcement actions. We also
reviewed the FCC Enforcement Bureau's Enforcement Manual and the Code of
Federal Regulations to understand how FCC conducts investigations,
determines whether a violation has occurred, and whether an enforcement
action is appropriate. Finally, to ensure that we fully understood FCC's
process for handling complaints, conducting investigations, and taking
enforcement actions, in April, 2007, we provided FCC's Enforcement Bureau
and CGB officials with a written summary of its processes for review. We
revised our summary based on FCC's technical comments.
To review how FCC assesses the impact of its enforcement program, we
interviewed both the Chief of the Enforcement Bureau and representatives
from each of the divisions about their methods for assessing the
effectiveness of their enforcement activities. We reviewed FCC's Strategic
Plan for 2006 through 2011, Fiscal Year 2006 Performance and
Accountability Report, Fiscal Year 2006 Congressional Justification of
Estimates, and FCC's Enforcement Manual in order to identify enforcement
goals and performance measures. We also reviewed provisions of the
Government Performance and Results Act of 1993 (GPRA) and prior GAO
reports on the effectiveness of GPRA and the methods other federal
agencies use to measure their performance in order to identify leading
performance measurement practices. We also analyzed FCC's quarterly
complaint reports to assess the volume and subject matter of complaints
over the past 4 years. As part of our analysis of the performance measures
used by FCC's Enforcement Bureau, we also interviewed officials from the
Federal Trade Commission (FTC) to identify their methods for assessing the
effectiveness of their enforcement program and obtained and reviewed
information from FTC on its enforcement activities, as well as its
Strategic Plan for 2006 through 2011, and Fiscal Year 2006 Performance and
Accountability Report. To understand how FCC selects subjects and
companies for investigation, we reviewed documentation for FCC's Data
Analysis Report on Telecommunications and FCC reports based on that
analysis for 2000 through 2006. In performing our work, we also reviewed
and considered best practices identified in previous GAO reports and
guides issued over the years on strategic plans and planning processes and
the implementation of GPRA requirements. These documents helped us to
compare the FCC Enforcement Bureau's management practices with those of
leading organizations.
To obtain views on the effectiveness of FCC's enforcement efforts, we
contacted 25 telecommunications companies and obtained interviews with
executives from 15 of them. Of the 15 companies, 4 were in the radio and
television broadcasting industry; 4 were in the cable and satellite
industry; and 7 were in the wireless and wireline industry. In making this
selection, we chose companies based on the following criteria: type of
communication services provided (radio and television broadcasting, cable
and satellite, wireless and wireline telecommunications services) and
company size (small, medium, and large) according to FCC and industry
data. We also contacted seven experts with knowledge of the
telecommunications sector and FCC's enforcement program and obtained
interviews with five of them. Among the five experts, two are academicians
who have taught and written extensively about telecommunications, and the
other three once held positions at FCC but are no longer employed at the
Commission. The views we obtained from stakeholders and experts may not be
representative of all stakeholders, but we asked both experts and
stakeholders about similar issues.
Finally, to identify challenges FCC faces in providing complete and
accurate information on its enforcement program, we interviewed FCC
officials to understand how complaints are processed, investigated, and
resolved. We obtained from FCC six different databases in various formats,
five from the Enforcement Bureau and one from CGB; sent and received
answers to data reliability questions; and discussed the limitations of
each of the Enforcement Bureau's databases with staff from each of the
divisions in the Enforcement Bureau. We examined each database for
consistency in order to determine if the fields were sufficient for use.
Based on this analysis, we developed a list of fields we could use from
each database and compared the fields across databases to determine what
data elements could be reported across all databases. We found that we
were limited in what we could report.
We conducted this performance audit from November 2006 through December
2007 in accordance with generally accepted government auditing standards.
Those standards require that we plan and perform the audit to obtain
sufficient, appropriate evidence to provide a reasonable basis for our
findings and conclusions based on our audit objectives. We believe that
the evidence obtained provides a reasonable basis for our findings and
conclusions based on our audit objectives.
Appendix II: Comments from the Federal Communications Commission
Federal Communications Commission:
Washington, D.C. 20554:
Mr. Mark Goldstein:
Director, Physical Infrastructure:
U.S. Government Accountability Office:
Washington, DC 20548:
Dear Mr. Goldstein:
Thank you for the opportunity to respond to the draft Government
Accountability Office (GAO) report concerning the enforcement processes
of the Federal Communications Commission (FCC or Commission) for the
period January 1, 2003 through December 31, 2006.
The Commission is a proponent of strong enforcement action to protect
consumers and to ensure the Communications Act of 1934, as amended (the
Act), is carried out in the manner intended by Congress. During
Chairman Martin's tenure, the Commission has undertaken more than 3,400
enforcement actions. These enforcement actions have resulted in
assessing more than $65.7 million in fines, forfeitures, and consent
decree payments � including more than $43 million in 2007 alone, which
the GAO acknowledges is the highest annual amount since the Enforcement
Bureau was created in 1999. [Footnote 31] In addition, the Commission
has devoted significant resources to reviewing and taking action on a
backlog of more than 113,000 consumer complaints; as a result, the
Commission no longer has a backlog of these complaints and now takes
action faster on a consumer's complaint.
Because the Commission's enforcement program is an important tool for
ensuring the statutory goals of the Act are met, we welcome
recommendations on making improvements. In its draft report, the GAO
recommends that the Commission improve how it collects and analyzes
enforcement-related data (e.g., complaints received, investigations
conducted, enforcement actions taken). Indeed, the report concludes
that "[l]imitations in FCC's current approach for collecting and
analyzing enforcement data constitute the challenge FCC faces in
providing complete and accurate information on its enforcement
program." [Footnote 32] In addition, the GAO recommends that the
Commission develop and implement performance management practices,
including the establishment of goals and performance measures. See GAO
Draft Report at pages 35-36.
I am pleased to report that the Commission has already implemented
measures that address both GAO recommendations. The GAO report focuses
on the period from 2003 through 2006. As staff indicated to the GAO
during its examination, by the time of this audit, we were already
aware of these issues and already had plans in place to improve both
the Commission's enforcement data collection and processes.
First, the Commission had recognized that one of its principle
challenges was its limited information systems and database management
resources. By July 2007, the Commission had already secured
Congressional approval to make significant modifications to the
databases and systems used to support the Commission's enforcement
activities. [Footnote 33] The budget and planning processes for these
systems enhancements had been underway for some time, and we expect
final delivery this year. We anticipate that this system will enhance
the Commission's ability to collect more detailed complaint information
from consumers as well as improve the Commission's case management
system to better track the status of all enforcement complaints
throughout the process.
Second, during Chairman Martin's tenure, the Commission has implemented
standardized enforcement performance goals to better manage the
enforcement process and to automate portions of this process. [Footnote
34] The Commission implemented an internal performance measurements
program (including the establishment of written internal controls) to
collect data used to assess the performance and accountability of the
enforcement program. For the first time, under Chairman Martin, goals
and measures for managing the enforcement processes have been
incorporated into the performance plans of the senior executives
responsible for oversight of the enforcement program. Information about
these efforts is also included in the Commission's annual Performance
and Accountability Report and will be included going-forward in the
Commission's annual performance budget submissions to Congress.
Unfortunately, the GAO Report contains several errors that detract from
its utility. We raised these problems with GAO during the course of its
examination, but the flaws remain in the draft report. We have included
additional information in the attachment to this letter to respond to
the GAO's report.
First, the GAO relied on information that is significantly out-of-date
in making its conclusions and recommendations. In some cases, the GAO
relied on information more than four years old rather than examine more
current information. By relying on information that is out-of-date, the
GAO's draft report provides a misleading description of the
Commission's current enforcement processes. For example, the GAO
describes the Commission's former consumer complaint processes on page
6 of its draft report. However, because we had already concluded that
the former process needed to be changed to enforce the Commission's
consumer protection rules, we had already changed the process by which
the Commission handles consumer complaints. Today, unlike the past
practices that had been used since the Enforcement Bureau was started
in 1999, the Commission responds to 100% of consumer complaints. The
GAO's report, however, fails to acknowledge or assess the new process
and incorrectly describes the Commission's current consumer complaint
process. This is particularly unfortunate because our new process for
handling consumer complaints has realized meaningful benefits. For
example, the Commission issued 412 citations for violations of the junk
fax rules in 2007, which was approximately a 350% increase over the 91
citations issued in 2006 and a 984% increase over the 38 citations
issued in 2004. [Footnote 35]
Similarly, during the 2003-2006 period the GAO examined, the Commission
did not regularly collect and review data to measure the performance of
the enforcement program. This issue has been addressed. As noted above,
the Commission reports on these performance measures in its annual
Performance and Accountability Report and, going-forward, will provide
performance information in its annual budget submission to Congress. We
are concerned that GAO's failure to examine current practices and
processes significantly diminishes the value of the report.
Second, in addition to using outdated information, the GAO made errors
in presenting certain data. During the preparation of this report, the
Commission informed the GAO of our concerns that the draft report
contained factual flaws. For example:
* the GAO draft report at pages 19-20 (Table 2) contains inaccurate
information regarding the number and types of investigations and
enforcement actions taken by the Commission. Table 2 overstates the
number of enforcement investigations that were closed without action
because it fails to acknowledge certain actions taken by the Commission
such as findings of compliance, denials, and dismissals for
insufficient information provided by the complainant. Attachment 3
provides Commission data side-by-side to GAO's data as set forth in the
chart. The Commission's chart in Attachment 3 provides data on
enforcement actions which are contained in the Commission's databases
and paper files.
* the data presented on pages 19-20, which the GAO derived from the
Commission's databases, does not correspond to the information
contained in our databases. The GAO's draft report at pages 19-20
significantly understates the number of admonishments/warnings,
citations, consent decrees, monetary forfeitures, and notices of
violation issued [Footnote 36] and the report overstates the number of
investigations conducted during the 2003-2006 period. [Footnote 37]
* the GAO's draft report at pages 19-20 also significantly overstates
the number of investigations closed with no action. [Footnote 38] In
its draft report, the GAO states that the Commission closed with no
action 8,628 investigations concerning antenna lighting and structure
requirements. Had GAO scrolled to the problem resolution section of the
Commission's database it would have found readily available information
indicating that action had indeed been taken on a large portion of
these investigations. [Footnote 39] The problem resolution section of
the database contains a written description of the finding made by an
Enforcement Bureau employee for a particular investigation (e.g., no
violation found). Attachment 6 shows the problem resolution field in
the database for an antenna lighting and structure requirement
investigation. In addition, the Commission maintains files on each
investigation conducted by a field agent or other Commission personnel.
Because the GAO limited its inquiry to Commission databases, it failed
to accord for the outcomes of field investigations recorded in paper
files. In fact, the Commission's databases and paper files verify that
a significantly smaller number of investigations were closed with no
action than reported by the GAO. Only 32 investigations were closed
with no action instead of the 8628 contained in the GAO Report, a
difference of 26,863%. [Footnote 40]
* the GAO's draft report at pages 16-17 significantly overstates the
total number of investigations that were listed as closed with no
enforcement action. In its draft report, the GAO states that "about 83
percent or about 32,200 of the investigations were listed as closed
with no enforcement action." [Footnote 41] Attachment 2, however,
indicates that only 3 percent of investigations were closed with no
enforcement action taken. In fact, 71 percent of investigations were
closed with compliance found, 15 percent closed after taking action,
and 11 percent were closed as a result of insufficient information
being provided by the complainant. See Attachment 2. Had GAO scrolled
through the problem resolution or similar notation sections of the
Commission's databases it would have found readily available data
indicating that action had indeed been taken on all the domestic
interference, indecency, CPNI certification, audits of certification-
based facilities, Emergency Alert System requirements, and Cable TV
leakage investigations listed in the Report. [Footnote 42] As
demonstrated in Attachment 7 showing examples of actual investigations
of various types in the databases, the problem resolution section of
the database memorializes findings made by the Enforcement Bureau staff
during a particular investigation. The notation would indicate whether
a finding of compliance was made, whether the investigation was
dismissed for insufficient information provided by the complainant, or
whether the issue was resolved at the time of inspection (e.g.,
interference resolved prior to inspection). In addition, the Commission
maintains paper files on each investigation conducted by a field agent
or other Commission personnel. The Commission's databases and paper
files verify that a significantly smaller number of investigations were
closed with no action than reported by the GAO. [Footnote 43] Only 576
investigations were closed with no action instead of the 32,237
contained in the GAO Report. [Footnote 44]
* the GAO's draft report at pages 12-13 (Figure 1) only reflects the
status of complaints received by the Consumer and Governmental Affairs
Bureau (CGB) during the year in which the complaint was received. The
chart does not capture information about the disposition of complaints
received in one year and resolved in a subsequent year. The draft
report thus leaves the impression that complaints were unresolved when
in fact they were resolved, albeit in a subsequent year. Attachment 1
provides the number of complaints received from 2003-2006 and indicates
that no complaints are pending for 2003, 2004, and 2005. Only 62
complaints are pending for 2006.
Because the GAO failed to identify which complaints or cases were in
the "all other investigations" or "general enforcement" categories, we
were unable to resolve the data inconsistencies and inaccuracies in the
draft report.
Third, the GAO makes a number of incorrect statements in its report.
For example, the GAO states on page 3 that the Commission's existing
enforcement databases do not contain information about the disposition
of a complaint (e.g., whether the Commission took enforcement action or
concluded that no violation occurred). This is incorrect � the
Commission's systems do contain this information. This information
resides in the problem resolution or similar notation sections of the
Commission's database systems. This section of the database was readily
accessible to GAO during the course of their investigation. We informed
the GAO about the disposition information on several occasions and
offered to make technical assistance available.
Finally, the GAO's draft report fails to include important information
to assist the reader of the report. For example, the GAO's description
of the Commission's enforcement processes and statutory authority fails
to include any discussion about the legal standards applicable to the
Commission's enforcement process, including the appropriate burden of
proof the Commission must meet in order to issue a notice of apparent
liability, citation, notice of violation, admonishment, or warning.
Similarly, on page 10 the GAO failed to discuss other sections of the
Act that provide authority for fines or sanctions or the procedural and
other legal requirements that govern license revocation proceedings. By
leaving this important information out of the draft report, the GAO
provides an incomplete and misleading picture about the legal
environment in which the Commission's enforcement activities operate.
Although we are concerned about the flaws in the GAO's examination
noted above, we do appreciate the GAO's examination into the
Commission's enforcement processes. Moreover, we agree that the
Commission needed to improve our data management systems from the
limited time frame examined, for which we have already contracted, and
provide specific enforcement goals, which we have already implemented.
We look forward to working with the GAO on this and other matters in
the future.
Sincerely,
Signed by:
Kris Anne Monteith:
Chief, Enforcement Bureau:
Attachments:
Appendix III: GAO Contact and Staff Acknowledgments
GAO Contact
Mark L. Goldstein, (202) 512-2834 or [28][email protected]
Staff Acknowledgments
In addition to the contact named above, individuals making key
contributions to this report include Tammy Conquest, Assistant Director;
Eli Albagli; Martin De Alteriis; Konstantin Dubrovsky; Sharon Dyer; Bess
Eisenstadt; Heather Frevert; Mitch Karpman; Josh Ormond; Mindi
Weisenbloom; and Nancy Zearfoss.
(543182)
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Highlights of [36]GAO-08-125 , a report to the Chairman, Subcommittee on
Telecommunications and the Internet, Committee on Energy and Commerce,
House of Representatives
February 2008
TELECOMMUNICATIONS
FCC Has Made Some Progress in the Management of its Enforcement Program
but Faces Limitations, and Additional Actions Are Needed
The Federal Communications Commission (FCC) annually receives about
100,000 complaints from individuals and companies. FCC has the authority
to investigate these complaints and take enforcement action if it finds a
violation of the telecommunications laws and rules, which are designed to
ensure, for example, that individuals have access to 911 services and a
wider affordable range of communication services.
As requested, this report reviews FCC's enforcement program and (1)
summarizes the number and type of complaints received, investigations
conducted, and enforcement actions taken by FCC from 2003 through 2006;
(2) discusses how FCC assesses the impact of its enforcement program; and
(3) discusses challenges FCC faces in providing complete and accurate
information on its enforcement program. To address these objectives, GAO
analyzed FCC's databases, interviewed FCC officials, telecommunications
executives, and experts.
[37]What GAO Recommends
The Chairman, FCC, should improve FCC's data collection and analysis to
help it better manage its enforcement efforts and develop and implement
performance goals and outcome measures for its enforcement program. FCC
said it has already implemented measures that address both
recommendations; however, the actions it identified do not fully address
our recommendations.
According to GAO's analysis of FCC data, between 2003 and 2006, the number
of complaints received by FCC totaled about 454,000 and grew, from almost
86,000 in 2003, to a high of about 132,000 in 2005. The largest number of
complaints alleged violations of the do-not-call list request and
telemarketing during prohibited hours. FCC processed about 95 percent of
the complaints it received. FCC also opened about 46,000 investigations
and closed about 39,000; almost 9 percent of these investigations were
closed with an enforcement action, and about 83 percent were closed with
no enforcement action. GAO was unable to determine why these
investigations were closed with no enforcement action because FCC does not
systematically collect these data. FCC told GAO that some investigations
were closed with no enforcement action because no violation occurred or
the data were insufficient.
FCC assesses the impact of its enforcement program by periodically
reviewing certain program outputs, such as the amount of time it takes to
close an investigation, but it lacks management tools to fully measure its
outcomes. Specifically, FCC has not set measurable enforcement goals,
developed a well-defined enforcement strategy, or established performance
measures that are linked to the enforcement goals. Without key management
tools, FCC may have difficulty assuring Congress and other stakeholders
that it is meeting its enforcement mission.
Limitations in FCC's current approach for collecting and analyzing
enforcement data constitute the principal challenge FCC faces in providing
complete and accurate information on its enforcement program. These
limitations make it difficult to analyze trends; determine program
effectiveness; allocate Commission resources; or accurately track and
monitor key aspects of all complaints received, investigations conducted,
and enforcement actions taken.
Disposition of FCC's 39,000 Closed Investigations, Calendar Years 2003
through 2006
References
Visible links
22. http://www.gao.gov/cgi-bin/getrpt?GAO-04-38
23. http://www.gao.gov/cgi-bin/getrpt?GAO/GGD-00-10
24. http://www.gao.gov/cgi-bin/getrpt?GAO/GGD/AIMD-99-69
25. http://www.gao.gov/cgi-bin/getrpt?GAO-04-801
26. http://www.gao.gov/cgi-bin/getrpt?GAO-06-425
27. mailto:[email protected]
28. mailto:[email protected]
29. http://www.gao.gov/
30. http://www.gao.gov/
31. http://www.gao.gov/fraudnet/fraudnet.htm
32. mailto:[email protected]
33. mailto:[email protected]
34. mailto:[email protected]
35. http://www.gao.gov/cgi-bin/getrpt?GAO-08-125
36. http://www.gao.gov/cgi-bin/getrpt?GAO-08-125
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