FCC Proposes Record $34 Million Fine for Marketing Illegal Signal Jammers

Continuing an aggressive "zero tolerance" enforcement approach regarding signal jammers, the FCC on June 19, 2014 proposed to fine a Chinese-based equipment manufacturer a record $34.9 million for marketing signal jamming equipment. The fine is based on an undercover investigation undertaken by Enforcement Bureau personnel. As such, the Commission's action follows a trend in the use of this investigative technique that began several years prior. Further, the Commission ordered the company to report additional information to the Commission, including the names of each purchaser of equipment in the United States. The action underscores the obligation that all manufacturers have to ensure that their products meet applicable FCC limits and restrictions.

The $34.9 million Notice of Apparent Liability is significant not only for the size of the fine, but also for the activities the Commission is pursuing to detect violations. This NAL reflects the maximum statutory penalty for each of 285 violations the Commission found. Once again, the Commission chose to calculate the proposed forfeiture based on the number of models sold, and to treat each different model sold as a separate violation of the Communications Act. The Commission found that C.T.S.'s violations were continuing, and imposed the maximum fine of $122,500 per violation.

Equally important is the proactive nature of the FCC enforcement action. The NAL states that the Spectrum Enforcement Division of the Enforcement Bureau observed the advertsiement of signal jammers on the company's Internet sites. Several Bureau personnel purchased a total of 10 devices, using different aliases to pose as a U.S. customer. This approach continues a tactic of the Bureau scanning public websites for advertisement of illegal devices.

Finally, the Commission issued two directives to C.T.S. Technology:

1. It ordered C.T.S. to "immediately implement" any necessary measures to block the sale of unauthorized jamming devices. The Commission suggested that C.T.S. may do so by removing jamming devices from online displays available to U.S. users, excluding U.S. customers in any online or print marketing material or blocking the shipment of devices to the United States, among other potential measures.
2. It ordered C.T.S. to submit information requested (in a confidential attachment) concerning the company's distribution channels and sales in the U.S. The requested information includes identification of each purchaser of signal jamming equipment in the United States.