Vexus Fiber agreed to pay a $100,000 fine for selling only its slowest service plan to customers in the FCC’s Affordable Connectivity Program (ACP). The penalty is part of a Consent Decree reached with the Enforcement Bureau.
The broadband provider, which provides Lifeline services in Texas and Louisiana, admitted it broke FCC rules and will implement a compliance plan to prevent future occurrences. In exchange, the agency dropped the investigation.
Among the regulations, participating providers must allow eligible customers to apply the ACP benefits to any of the broadband services they offer. “Both the Act and the Commission’s Rules prohibit the practice of ‘downselling’ in connection with the ACP, which the Commission has defined as ‘any business practice that pressures a subscriber to lower the quality of broadband service … to the benefit of the provider rather than the consumer,’” Enforcement Bureau Chief Loyaan Egal says in the order.
“The rules explicitly prohibit providers from “exert[ing] pressure on an eligible household to induce the purchase of a broadband internet access service or bundled plan that is … less costly, … provides higher or lower speed or bandwidth, [or] is subject to higher or lower data caps … than the service or plan that the household is already purchasing or has inquired about purchasing through the [ACP],” states the order. Violating this rule undermines “the purpose, intent, or integrity” of the ACP, says the Commission.
Vexus was originally authorized to provide services under the Emergency Broadband Benefit Program in Texas and Louisiana in March 2021, which were transferred to the ACP when that program launched. As of June 2023, Vexus had over 8,000 ACP customers.
The bureau received a complaint in January 2023, that Vexus had an established policy of offering a 150/150 Mbps broadband plan, its slowest and lowest-cost broadband plan to customers seeking to take advantage of the ACP discount. Responding to the FCC’s investigation, Vexus admitted this was true from January to April 2023, when it stopped the practice and retrained its employees.
Vexus agreed to develop and implement a compliance plan within 60 days and send periodic compliance reports to the FCC. It must pay the civil penalty to the U.S. Treasury Department within 30 days by credit card, Automated Clearing House debit from a bank account, or by wire transfer from a bank account. The Commission no longer accepts civil penalty payments by check or money order.
By Leslie Stimson, Inside Towers Washington Bureau Chief
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