The Federal Communications Commission (FCC) has reached a $5 million settlement with magicJack, a voice over internet provider (VoIP), over the company’s “failure to report its interstate revenues and contribute to the Universal Service Fund.” The company was investigated for violating various sections of the Communications Act of 1934 and FCC rules. magicJack sells VoIP telephone service to consumers, it has also agreed to a three-year compliance plan with the FCC in addition to the settlement. This concludes the investigation against the VoIP; the FCC determined that the agreement would best serve the public interest.
The compliance measures will include a plan to ensure “future compliance with the Federal Regulatory Reporting and Contribution Rules and the terms and conditions of the Consent Decree.” It will include operating procedures, a compliance manual, compliance training program, filing federal forms, pay contributions, report noncompliance, and file compliance reports within 90 calendar days, 12 and 24 months after the implementation date. magicJack has 30 days to pay the settlement.
“Today’s settlement sends a strong message that we take seriously the requirements on VoIP service providers to meet their legal obligations,” FCC Chairman Ajit Pai said. “I am glad we can resolve this long-standing investigation. I thank the FCC Enforcement Bureau team for their hard work and dedication to enforcing the law.”
The settlement covers magicJack VocalTec Ltd., magicJack, LP, and YMax Communications Corp., collectively referred to as magicJack. The settlement resolves the investigation led by the Enforcement Bureau and clearly establishes that magicJack will comply with federal rules in the future.
