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AT&T Accused of Eavesdropping, Calling Record Sales

By Martin H. Bosworth
ConsumerAffairs.com

February 1, 2006

Calling Records • FTC Shuts Down Pretexting Operation • Phone Pretexters Get Off Cheap • Verizon Wireless Changes Customer Data Policy • FCC Strengthens Rules For Phone Privacy • House Tries Once More to Pass Pretexting Bill • Pretexting Bill: Pretense or Reality? • Hewlett-Packard Pays $14.5 Million to Settle Pretexting Suit • HP Scandal Ignites New Pretexting Battle In Congress • AT&T Sues Calling Record Brokers • Sprint Nextel Settles Case with Florida Data Broker • Feds Sue Calling Record Vendors • Illinois Lawsuit Charges Data Brokerages • Florida Judgment to End Data Broker's Business • Florida Investigates Fake Caller IDs • California Sues Data Trace USA for $10 Million • Missouri Sues Datatraceusa.com • Florida Sues Data Broker Over Sale of Phone Records • Texas Sues Companies Selling Telephone Calling Records • Websites Hawking Phone Records Shut Down • FTC Vows to Stop Illicit Sale of Cell Phone Calling Records • FTC Pledges "Vigorous" Pursuit of Cell Phone Record Sales • AT&T Accused of Eavesdropping, Calling Record Sales • Sprint Sues Cell Phone Record Brokers • Missouri Shuts Down Locatecell.com • Texas Probes Cell Phone Calling Record Sales, Missouri Files Suit • Illinois Sues Company Selling Cell Phone Calling Records • Outcry Over Sale of Cell Phone Calling Records

When telecommunications giant SBC bought AT&T and adopted the famous brand name as its own, it also inherited a lot of baggage, including an apparent inability to protect the privacy of its customers' records.

The company is facing a lawsuit for its part in allowing the National Security Agency (NSA) to conduct surveillance on its customers, via granting the NSA access to their vast databases of customer records and information.

AT&T is also potentially facing fines from the Federal Communications Commission (FCC) for failing to properly certify that its customers' records were safeguarded.

The Electronic Frontier Foundation (EFF) filed a class-action suit against AT&T in San Francisco yesterday (Jan. 31).

According to the filing, AT&T provided the NSA "with direct access to all or a substantial number of the communications transmitted through its key domestic telecommunications facilities, including direct access to streams of domestic, international and foreign telephone and Internet communications."

AT&T's cooperation enabled the NSA to "data-mine" the phone and Internet records for "suspicious" information, and to track communications that might lead to potential terrorist activity.

The NSA's surveillance program has been criticized for violating Americans' Fourth Amendment rights to defend against unwarranted searches and seizures. The EFF lawsuit also considers AT&T's actions a violation of the First Amendment right of freedom of speech, as well as numerous laws governing telecommunications privacy and wiretapping.

"Our goal is to go after the people who are making the government's illegal surveillance possible," Kevin Bankston, EFF staff attorney, told Wired magazine.

Failing Certification

Meanwhile, the FCC proposed fining AT&T $100,000 for failing to provide data certifying that it had complied with federal safeguards to protect customer privacy.

In the FCC's "Notice of Apparent Liability for Forfeiture," issued Jan. 30th, the agency stated that all major telecommunications companies had to verify their protection of their customers' proprietary network information ("CPNI"), or calling records.

AT&T had provided information on its customer safeguards in its prior incarnation as SBC, but not as the old AT&T corporation.

The report concluded that "AT&T has apparently failed to comply with the requirement that it have an officer certify on an annual basis…that AT&T has established operating procedures adequate to ensure compliance with the Commission's CPNI rules. For this apparent violation, we propose a forfeiture."

The $100,000 fine was also levied against telecom carrier Alltel for failing to fulfill the certification. Both companies can avoid the fine if they provide more information on their security procedures.

SBC posted earnings of $1.6 billion for the 4th quarter of 2005, after its acquisition of AT&T.

The sale of calling records to third-party companies has provoked investigations from numerous national newspapers, and calls to Congress for stronger legislation governing the protection of customers' information.

Sprint Nextel, T-Mobile, Verizon Wireless, and the states of Illinois and Missouri have all filed lawsuits against All Star Investigations, the company behind Web sites such as Locatecell.com, implicated for selling cellphone and land line records to third parties.

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