Bell Canada hit with $1.3 M penalty for violating do-not-call rules

OTTAWA – Bell Canada paid a record-high $1.3-million penalty for "unauthorized telemarking practices," including the peddling of its own services to people on the national do-not-call list, the Canadian Radio-television and Telecommunications Commission announced Monday.

The company hired independent telemarketers both in Canada and abroad who ended up contacting people on both the national and Bell’s internal do-not-call lists to promote and sell television, telephone, wireless and Internet services, the CRTC said.

"All telemarketers must respect the wishes of Canadians who have registered their telephone number on the National DNCL (do-not-call list) . . . " Andrea Rosen, the CRTC’s chief telecommunications enforcement officer, said in a statement. "Even though the calls in this instance were made by third parties, Bell Canada must ultimately ensure that the rules are followed. We appreciate Bell Canada’s willingness to work with us to address our concerns."

In a separate investigation, the company was also found to be making calls to its prepaid customers using automatic calling devices without their permission. Although Bell did not admit wrongdoing in this case, the company voluntarily agreed to pay $266,000 to Concordia University’s Institute for Information Systems Engineering, for a total payout of $1.566 million.

"These are the largest fines ever," Rosen said.

In a statement, Bell said it worked closely with the CRTC to investigate the complaints and determined that independent telemarketers had violated both the CRTC and Bell’s own calling rules.

"No violations were committed by any Bell-operated call centres," the company said. "Bell has terminated its relationships with two telemarketers and suspended several others due to non-compliance with the unsolicited telecommunications rules.

"Non-compliance with CRTC or Bell calling rules by third-party telemarketers results in immediate corrective action by Bell, up to and including suspension and termination of their contracts."

Under the National DNCL rules, there are exemptions for companies, including the firms being allowed to contact people if they are already clients of the business. Charities, political parties and pollsters, to name a few, are also exempt from the list.

Michael Geist, a law professor at the University of Ottawa who specializes in technology law, said he’s examined through access to information tens of thousands of complaints about the do-not-call list. Bell had the "largest source of complaints" dating back to the inception of the list.

"It’s tough to credibly claim that this comes as a surprise and this is all just about a third-party marketer not following the rules. I don’t doubt that it’s third party that was behind it, but there was certainly plenty of notice that this was a problem," said Geist.

"I think the CRTC had to send a message . . . There are many, many Canadians who looked at the do-not-call list and felt that it was frankly meaningless," he said, adding it’s ironic that Bell was awarded the five-year contract to actually operate the list.

The national do-not-call list was established in September 2008. There are over 8.4 million telephone or fax numbers on it.

Rosen said the CRTC won’t release specifics about complaints in this case, but said fines can run up to $15,000 per violation.

"I think after the 300,000 complaints we’ve received over the past three years, it isn’t surprising to see that companies are making mistakes," she said. "I don’t think $1.3 million is the cost of doing business for anybody."

Last Friday, the CRTC announced a $500,000 penalty – the second highest to date – to Calgary-based telemarketer Xentel DM Inc. It was fined for making 60 calls over the past 18 months to people on the national do-not-call list.

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