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 Federal  Communications  Commission  DA  02-  2697 
 Before  the  Federal  Communications  Commission 
 Washington,  D.  C.  20554 

 In  the  Matter  of  )  )  File  No.  EB-  01-  TC-  057 
 Yestel,  Inc.  )  FRN  No.  0007322456  ) 

 ORDER 

 Adopted:  October  16,  2002;  Released:  October  17,  2002 
 By  the  Chief,  Enforcement  Bureau: 

 1.  In  this  Order,  we  adopt  a  Consent  Decree  terminating  an  investigation  regarding  unauthorized  preferred  carrier  conversions  by  Yestel,  Inc.  (Yestel). 
 2.  The  Bureau  and  Yestel  have  negotiated  the  terms  of  a  Consent  Decree  that  would  resolve  this  matter  and  the  staff's  investigation.  A  copy  of  the  Consent  Decree  is  attached  and  is  incorporated  by 
 reference. 
 3.  We  have  reviewed  the  terms  of  the  Consent  Decree,  and  we  conclude  that  the  public  interest  would  be  served  by  approving  the  Consent  Decree  and  terminating  the  investigation. 

 4.  Based  on  the  record  before  us,  and  in  the  absence  of  material  new  evidence  relating  to  this  matter,  we  conclude  that  there  are  no  substantial  and  material  questions  of  fact  as  to  whether  Yestel 
 possesses  the  basic  qualifications,  including  its  character  qualifications,  to  hold  or  obtain  any  FCC  licenses  or  authorizations. 

 5.  Accordingly,  IT  IS  ORDERED,  pursuant  to  sections  4(  i)  and  503(  b)  of  the  Communications  Act,  47  U.  S.  C.    154(  i),  503(  b),  and  the  authority  delegated  in  sections  0.111  and  0.311  of  the 
 Commissions  rules,  47  C.  F.  R.    0.111,  0.311,  that  the  attached  Consent  Decree  IS  ADOPTED. 
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 6.  IT  IS  FURTHER  ORDERED  that  the  above-  captioned  case  as  well  as  the  Commission  staff  inquiry  into  the  matter  described  herein  ARE  TERMINATED. 
 FEDERAL  COMMUNICATIONS  COMMISSION 

 David  H.  Solomon  Chief,  Enforcement  Bureau 
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 CONSENT  DECREE 
 1.  The  Enforcement  Bureau  of  the  Federal  Communications  Commission  (  FCC  or  Commission)  and  Yestel,  Inc.,  (Yestel)  hereby  enter  into  a  Consent  Decree  terminating  an  informal 
 Bureau  investigation  into  possible  violations  of  section  258  of  the  Communications  Act  and  the  Commissions  rules  relating  to  unauthorized  preferred  interexchange  carrier  (  PIC)  conversions  and 
 third  party  verification  procedures.  1  Yestel  is  a  reseller  of  interstate  interexchange  telecommunications  services  as  well  as  international  telecommunications  services  and  is  subject  to  the  Commissions 
 regulations  pursuant  to  its  status  as  a  common  carrier.  This  Consent  Decree  is  the  result  of  an  informal  investigation  that  was  initiated  on  November  14,  2001. 

 2.  For  the  purposes  of  this  Consent  Decree  the  following  definitions  shall  apply:  a)  Commission  or  FCC  means  the  Federal  Communications  Commission; 

 b)  Bureau  means  the  Enforcement  Bureau  of  the  Federal  Communications  Commission; 
 c)  Division  means  the  Telecommunications  Consumers  Division  of  the  Enforcement  Bureau; 
 d)  Yestel    means  Yestel,  Inc.,  its  successors  and  assigns; 
 e)  Parties  means  Yestel  and  the  Commission  or  Bureau; 
 f)  Adopting  Order  means  an  Order  of  the  Bureau  adopting  the  terms  and  conditions  of  this  Consent  Decree; 

 g)  Effective  Date  means  the  date  on  which  the  Commission  adopts  the  Adopting  Order. 
 h)  Preferred  carrier  change  shall  mean  an  order  or  request  submitted  by  a  carrier  to  a  local  exchange  carrier  (  LEC)  to  effect  a  change  in  the  customers  preferred  carrier; 

 i)  Informal  Complaint  or  Consumer  Complaint  means  a  complaint  filed  under  47  C.  F.  R.    1.716; 
 j)  Formal  Complaint  means  a  complaint  filed  under  47  U.  S.  C.    208; 
 3.  The  Parties  agree  that  the  provisions  of  this  Consent  Decree  shall  be  subject  to  final  approval  by  the  Bureau  by  incorporation  of  such  provisions  by  reference  in  an  Adopting  Order  of  the  Bureau. 

 4.  The  Parties  agree  that  this  Consent  Decree  shall  become  effective  on  the  date  on  which  the  Bureau  releases  the  Adopting  Order.  Upon  release,  the  Adopting  Order  and  this  Consent  Decree  shall 
 have  the  same  force  and  effect  as  any  other  Order  of  the  Commission  and  any  violation  of  the  terms  of  this  Consent  Decree  shall  constitute  a  violation  of  a  Commission  Order  entitling  the  Commission  to 
 exercise  any  and  all  rights  and  to  seek  any  and  all  remedies  authorized  by  law  for  the  enforcement  of  a 
 1.  1  See  47  C.  F.  R.    64.1100;  64.1120. 
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 Commission  Order. 
 5.  Yestel  admits  the  jurisdiction  of  the  Commission  for  purposes  of  this  Consent  Decree  and  any  Adopting  Order. 

 6.  Yestel  waives  any  rights  that  it  may  have  to  further  procedural  steps  and  any  rights  it  may  have  to  seek  judicial  review  or  otherwise  challenge  or  contest  the  validity  of  the  Adopting  Order  or  this 
 Consent  Decree. 
 7.  Yestel  waives  any  rights  it  may  have  under  any  provision  of  the  Equal  Access  to  Justice  Act,  5  U.  S.  C.    504. 

 Terms  of  Settlement 
 8.  Yestel  represents  and  warrants  that  it  is  the  properly  named  party  to  this  Consent  Decree  and  is  solvent  and  has  sufficient  funds  available  to  meet  fully  all  financial  and  other  obligations  set  forth 
 herein.  Yestel  further  represents  and  warrants  that  it  has  caused  this  Consent  Decree  to  be  executed  by  its  authorized  representative,  as  a  true  act  and  deed,  as  of  the  date  affixed  next  to  said  representatives 
 signature.  Said  representative  and  Yestel  respectively  affirm  and  warrant  that  said  representative  is  acting  in  his  capacity  and  within  his  authority  as  a  corporate  officer  of  Yestel,  and  on  behalf  of  Yestel  and  that 
 by  his  signature  said  representative  is  binding  Yestel  to  the  terms  and  conditions  of  this  Consent  Decree.  Yestel  also  represents  that  it  has  been  represented  by  counsel  of  its  choice  in  connection  with  this  Decree 
 and  is  fully  satisfied  with  the  representation  of  counsel. 
 9.  Yestel  represents  and  warrants  that  it  shall  not  effect  any  change  in  its  form  of  doing  business  or  its  organizational  identity  or  participate  directly  or  indirectly  in  any  activity  to  form  a  separate  entity  or 
 corporation  which  engages  in  acts  prohibited  in  this  Consent  Decree  or  for  any  other  purpose  which  would  otherwise  circumvent  any  part  of  this  Decree  or  the  obligations  of  this  Decree. 

 10.  In  consideration  for  the  termination  by  the  Bureau  of  its  investigation  into  whether  Yestel  has  violated  the  Communications  Act  and/  or  Commission  rules  or  orders,  and  in  accordance  with  the  terms  of 
 this  Consent  Decree,  Yestel  agrees  to  the  following  terms. 
 11.  The  Bureau  and  Yestel  agree  that  this  Consent  Decree  does  not  constitute  either  an  adjudication  on  the  merits  or  a  factual  or  legal  finding  or  determination  regarding  any  compliance  or 
 noncompliance  with  the  requirements  of  the  Communications  Act  or  the  Commissions  rules,  including  section  258  of  the  Act.  The  parties  agree  that  this  Consent  Decree  is  for  settlement  purposes  only  and  that 
 by  agreeing  to  this  Consent  Decree,  Yestel  does  not  admit  or  deny  any  liability  for  violating  the  Act  or  Commission  rules  in  connection  with  the  matters  that  are  the  subject  of  this  Consent  Decree. 

 12.  Yestel  shall  make  a  voluntary  contribution  to  the  United  States  Treasury  in  the  total  amount  of  $150,000  (one  hundred  fifty  thousand  dollars).  This  amount  shall  be  paid  within  30  days  of  the  date 
 the  order  adopting  this  Consent  Decree  becomes  final.  Such  contribution  shall  be  made,  without  further  protest  or  recourse,  by  certified  check,  cashiers  check,  or  money  order  drawn  to  the  order  of  the  Federal 
 Communications  Commission,  and  shall  be  mailed  to  the  Federal  Communications  Commission,  P.  O.  Box  73482,  Chicago,  Illinois  60673-  7482. 
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 13.  Yestel  agrees  to  reimburse  in  full  all  affected  consumers  whose  long  distance  service  was  switched  without  authorization  to  Yestels  network.  Specifically,  Yestel  agrees  to  reimburse,  through 
 billing  credits  for  unpaid  balances  and  through  issuance  of  checks  for  amounts  already  paid,  all  affected  consumers  the  full  amount  of  any  unauthorized  Yestel  charges  whether  or  not  the  consumer  paid  the 
 charges  in  error  or  disputed  them.  Yestel  also  agrees  to  return  affected  consumers,  where  necessary,  to  their  preferred  carriers  of  choice  and  order  all  collection  agencies  to  close  out  all  outstanding  disputes  and 
 remove  any  negative  credit  reports  for  all  affected  consumers.  Furthermore,  Yestel  agrees  to  notify  all  affected  consumers  verbally  of  the  unauthorized  conversion  and  apprise  them  of  their  credit  for  Yestel 
 charges;  if  after  two  attempts  to  reach  the  consumer,  Yestel  is  unable  to  speak  to  the  consumer,  Yestel  will  notify  the  consumer  in  writing  of  the  unauthorized  conversion  and  credit.  No  attempt  will  be  made 
 by  Yestel  personnel  to  market  Yestel  services  to  the  consumer  in  these  notification  efforts.  All  preferred  carrier  change  charges  associated  with  the  switch  of  the  consumer  back  to  his  or  her  preferred  long 
 distance  carrier  shall  be  paid  by  Yestel.  All  credits  and  checks  will  be  issued  no  later  than  sixty  (60)  days  from  the  date  on  which  this  Consent  Decree  is  adopted. 

 14.  In  addition,  Yestel  agrees  to  ensure  that  all  preferred  carrier  change  notifications  are  the  product  of  current  and  valid  third  party  verification  procedures.  Yestel  shall  not,  under  any  circumstances, 
 rely  on  communications  from  its  underlying  carrier  to  effectuate  a  preferred  carrier  change  for  any  customer,  --  former,  current,  or  prospective.  Yestel  will  also  create  a  task  force  to  ensure,  more  generally, 
 that  information  regarding  customer  records  is  kept  current  and  updated  monthly.  Yestel  will  meet  these  obligations  no  later  than  sixty  (60)  days  from  the  date  on  which  this  Consent  Decree  is  adopted. 

 15.  Yestel  agrees  that  it  will  send  each  consumer  whose  line  was  switched  to  Yestel  without  authorization,  a  $10.00  prepaid  Yestel  calling  card  within  sixty  (60)  days  of  the  date  on  which  the 
 Consent  Decree  is  adopted.  Yestel  is  giving  these  prepaid  cards  as  an  additional  gesture  of  goodwill  and  apology.  It  will  be  made  clear  that  acceptance  and  use  of  this  prepaid  card  in  no  way  constitutes  a  request 
 by  the  recipient  for  Yestel  direct-  dial  service.  Yestel  shall  not  include  marketing  materials  in  this  mailing.  A  sample  of  this  mailing  shall  be  provided  to  the  Bureau  ten  (10)  calendar  days  before  it  is  used. 

 16.  Yestel  agrees  that,  in  the  future,  it  shall  not  knowingly  submit  to  any  LEC  any  preferred  carrier  change  request  unless  Yestel  has  complied  with  all  Commission  rules  and  orders  concerning 
 preferred  carrier  changes,  in  effect  or  as  they  may  be  hereafter  modified  or  amended.  In  the  event  that  Yestel  discovers  that  its  procedures  for  acquiring  customers  have  been  compromised  by  poor 
 communication  with  its  underlying  carrier,  or  by  any  actions  taken  by  its  employees  or  its  authorized  agents,  resulting  in  the  unauthorized  conversion  of  a  consumers  line  to  Yestel,  Yestel  agrees  to  notify 
 such  consumer  verbally  of  the  unauthorized  conversion;  if  after  two  attempts  to  reach  the  consumer,  Yestel  is  unable  to  speak  to  the  consumer,  Yestel  will  notify  the  consumer  in  writing  of  the  unauthorized 
 conversion.  No  attempt  will  be  made  by  Yestel  personnel  to  market  Yestel  services  to  the  consumer  in  these  notification  efforts.  Yestel  shall  take  any  and  all  necessary  and  reasonable  steps  to  ensure  that  the 
 customer  is  promptly  returned  to  his  or  her  authorized  carrier  with  the  least  possible  inconvenience  to  the  customer.  Yestel  further  agrees  to  credit  such  consumer  in  full  for  all  Yestel  charges  incurred  between 
 the  date  on  which  the  consumer  was  switched  to  the  Yestel  network  until  the  consumer  is  switched  back  if  desired.  Yestel  further  agrees  to  reimburse  the  consumer  for  any  switching  fees  assessed  by  the  local 
 exchange  carrier  as  a  result  of  the  unauthorized  conversion  and  return  the  consumer  to  his  or  her  preferred  carrier. 

 17.  Yestel  agrees  to  subject  all  of  its  employees  and  agents  to  the  following  oversight  mechanisms  to  help  ensure  compliance  with  the  Commissions  regulations: 
 a)  Yestel  shall  require  each  employee  or  agent  both  at  the  time  of  hiring  and  at  least  twice  a 
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 year  thereafter  to  receive  formal  training  on  the  Commissions  rules  regarding  preferred  carrier  change  requests.  Should  those  rules  and  orders  change,  Yestel  will  ensure  that  its 
 employees  and  agents  are  promptly  apprised  of  such  changes  and  that  the  training  material  is  updated  to  reflect  the  new  rules. 

 b)  Yestel  shall  observe  its  employees  and  agents,  through  on-  site  or  telephonic  monitoring,  as  they  process  orders  for  service  and  complaints  to  ensure  that  Yestel  employees  and  agents 
 are  operating  in  compliance  with  the  Commissions  preferred  carrier  change  rules.  The  telephonic  monitoring  shall  take  place  weekly,  with  the  calls  monitored  on  a  random  basis. 
 Should  Yestel  receive  information  indicating  that  a  particular  employee  or  agent  has  engaged  in  practices  that  may  violate  the  Commissions  preferred  carrier  change  rules,  either 
 knowingly  or  inadvertently,  Yestel  shall  monitor  the  calls  of  that  agent  for  a  period  of  time  sufficient  to  determine  whether  he  or  she  is  operating  in  compliance  with  the  Commissions 
 rules  and  orders.  If  Yestel  discovers  noncompliance,  such  agent  shall  be  terminated  in  accordance  with  Yestels  standard  termination  procedures. 

 c)  Yestel  shall  further  ensure  that  its  third  party  verifier  collects  all  required  information  pursuant  to  section  64.1120(  c)(  3)(  iii)  of  the  Commissions  rules. 

 18.  While  this  Consent  Decree  is  in  effect,  Yestel  agrees  to  maintain  and  make  available  to  the  Bureau,  on  a  quarterly  basis  and  within  14  days  of  the  receipt  of  any  specific  written  request  from  the 
 Bureau,  business  records  demonstrating  compliance  with  the  terms  and  provisions  of  this  Consent  Decree. 

 19.  In  light  of  the  covenants  and  representations  in  this  Consent  Decree,  and  in  particular,  in  light  of  the  fact  that  Yestel  apparently  took  steps  to  correct  the  problem  causing  the  unauthorized  preferred 
 carrier  conversions  shortly  after  it  was  discovered,  the  Bureau  agrees  to  terminate  its  investigation  into  unauthorized  conversions  described  above,  without  any  finding  of  liability  on  the  part  of  Yestel.  The 
 Bureau  further  agrees  that,  in  the  absence  of  substantial  additional  and  material  facts,  the  Bureau  shall  not  on  its  own  motion  institute  against  Yestel  new  proceedings  of  any  kind  relating  to  any  allegation  of 
 unauthorized  preferred  carrier  changes  that  may  have  occurred  as  a  result  of  the  unlawful  actions  described  above  and  up  to  the  date  on  which  this  Consent  Decree  is  adopted. 

 20.  Nothing  in  this  Consent  Decree  shall  prevent  the  Commission  from  adjudicating  complaints  against  Yestel  for  alleged  misconduct  regarding  unauthorized  preferred  carrier  changes  or  for  any  other 
 type  of  alleged  misconduct  regardless  of  when  such  misconduct  took  place,  or  from  instituting  new  investigations  or  enforcement  proceedings  against  Yestel  in  the  event  of  alleged  future  misconduct.  If 
 such  enforcement  proceeding  is  initiated,  Yestels  earlier  conduct  may  be  adduced,  but  not  for  the  purpose  of  assessing  monetary  forfeitures. 

 21.  The  Parties  agree  that  any  provision  of  the  Consent  Decree  that  conflicts  with  any  subsequent  rule  or  order  adopted  by  the  Commission  will  be  superseded  by  such  Commission  rule  or  order. 
 22.  The  Parties  agree  that  this  Consent  Decree  shall  expire  in  three  (3)  years  from  the  release  date  of  the  Order  adopting  this  Consent  Decree.  Yestel  shall  issue  a  report  to  the  Bureau  within  60  days  from 
 the  release  date  demonstrating  compliance  with  the  terms  and  provisions  herein. 
 23.  This  Consent  Decree  may  be  signed  in  counterparts. 
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 For  the  Enforcement  Bureau,  For  Yestel,  Inc.  Federal  Communications  Commission 
 ____________________________  ________________________  David  H.  Solomon  Robert  Wu 
 Chief  President 

 ____________________________  ________________________  Date  Date 
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