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Cellphone carriers facing roughly $200 million in fines for sharing their customers’ locations are for now shielded from paying by the Federal Communications Commission’s partisan deadlock, according to people familiar with the matter.
The U.S. telecom regulator currently has four commissioners—two Democrats and two Republicans—and needs at least three votes to move forward with fines it proposed years ago on the biggest wireless-service providers.
FCC Chairwoman
Jessica Rosenworcel,
a Democrat, in August circulated four forfeiture orders penalizing
AT&T Inc.,
Sprint,
US Inc. and
Communications Inc. for allegedly mishandling access to the real-time whereabouts of their subscribers, the people said. The commission hasn’t yet published the forfeiture orders.
The FCC can’t issue the orders without approval from at least three commissioners. The two Democrats on the commission have voted to approve the fines, while their Republican counterparts have yet to vote, the people said.
The FCC first outlined the penalties for cellphone carriers in early 2020 under then-Chairman
Ajit Pai,
a Republican. Democratic and Republican commissioners voiced support for the move.
The commission probed the cellphone carriers following public reports that data brokers with access to subscribers’ real-time locations were sharing that information with dozens of third-party companies that allegedly mishandled the data.
Prison-phone company Securus Technologies, for example, allegedly allowed its clients to look up phone users’ whereabouts without a court order or other verified documentation, the commission said. The company later discontinued the service.
Wireless carriers at the time defended systems that provided data for fraud detection and roadside assistance, among other services, but said they eventually cut off the data aggregators accused of mishandling the information. T-Mobile said that it would contest the regulators’ findings. It later acquired Sprint, though shareholder
SoftBank Group Corp.
kept some liability for the potential fines.
The penalties remained in limbo until August, when Ms. Rosenworcel moved to enforce them.
The FCC leadership has one vacant seat. The Biden administration last year named
Gigi Sohn
to fill the fifth spot but failed to advance her nomination through a divided Senate. It is unclear how the midterm elections will affect the nomination process. Ms. Sohn served as counselor to former FCC Chairman
Tom Wheeler
and led Public Knowledge, a public-interest group that advocates for stronger antitrust enforcement.
Write to Drew FitzGerald at andrew.fitzgerald@wsj.com
Copyright ©2022 Dow Jones & Company, Inc. All Rights Reserved. 87990cbe856818d5eddac44c7b1cdeb8
Appeared in the December 20, 2022, print edition as ‘Wireless Firms Get Reprieve On Fines.’
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