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TUCoPS :: Cyber Law :: teleco~2.txt

Illegal Blocking of Long Distance Calls




From telecom@eecs.nwu.edu Sat Nov  3 16:08:57 1990
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Date:     Sat, 3 Nov 90 15:09:02 CST
From: TELECOM Moderator <telecom@eecs.nwu.edu>
To: ptownson@gaak.LCS.MIT.EDU
Subject:  Telecom Blocking
Message-Id:  <9011031509.aa12657@delta.eecs.nwu.edu>
Status: R


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          22 Oct 90 18:51 CDT
Date: 22 Oct 90 18:26:00 CDT
From: JOHN WINSLADE <winslade@zeus.unomaha.edu>
Subject: wilson-2.msg
To: telecom <telecom@eecs.nwu.edu>
Message-ID:  <9010221851.aa01401@delta.eecs.nwu.edu>


Message No. 136 was left on 09-06-88 22:42    <PUBLIC>  <RECEIVED>
To.......  : Jim Schmickley
From.....  : Bruce Wilson
Subject..  : TELECONNECT
See also message number 118.
Message Area #2 "Open Discussion"

Having now read BLOCKER.DOC and BLOCKER2.TXT, I'll probably stop over
at the Utilities Board offices to take a look at the actual file, if
I can.  In the meantime, your attention is directed to Section 477.6,
Code of Iowa: 
     
                        CHAPTER 477
          TELEGRAPH AND TELEPHONE LINES AND COMPANIES
     
                            ***
     
     477.6  -  Delay  -  willful error - revealing contents. 
       Any  person  employed  in  transmitting  messages  by 
     telegraph  or  telephone must do  so  with fidelity and
     without  unreasonable  delay, and  if anyone  willfully
     fails thus to transmit them, or intentionally transmits
     a  message  erroneously, or  makes  known  the contents
     of any  message  sent or received to any person  except
     the  person to whom it  is addressed, or such  person's
     agent or  attorney, or  willfully  or wrongly takes  or
     receives any  telegraph or  telephone message, the per-
     son is guilty of a simple misdemeanor. 
     
Not being aware of it, I don't suppose you've considered asking the
Linn County Attorney to prosecute Teleconnect under this provision.  
That seems to be the proper venue, by virtue of Teleconnect having
its headquarters there and the "blocking" presumably having taken
place there or at the direction of company personnel working out of
its Cedar Rapids headquarters.  I didn't see anything in the Chapter
which leaves it to the Utilities Board to initiate a prosecution. 
     
This Code provision, in one form or another, has apparently been part of the 
law of Iowa since the Code of 1873.  However, the provision we're concerned 
with doesn't seem to have ever been tested in court.  If it was,  it never got 
as far as a published appellate court decision.  The only Iowa case dealing 
with this section at all is an 1880 case dealing with the disclosure 
provision; and in that case the telegraph operator had been  subpoenaed into 
cort and ordered to testify and produce copies of telegrams.  
    
Title 47, US Code (the Communications Act), also has some seemingly pertinent 
provisions at sections 201, 202, 206, and 207.  






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          22 Oct 90 19:14 CDT
Date: 22 Oct 90 18:22:00 CDT
From: JOHN WINSLADE <winslade@zeus.unomaha.edu>
Subject: Sue W's files
To: telecom <telecom@eecs.nwu.edu>
Message-ID:  <9010221915.aa19826@delta.eecs.nwu.edu>

In the next several messages, I am sending the raw text files that would
not pass through yesterday.  The subjects will be the original file names.
 
Good Day!       JSW



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          22 Oct 90 19:15 CDT
Date: 22 Oct 90 18:23:00 CDT
From: JOHN WINSLADE <winslade@zeus.unomaha.edu>
Subject: blocking.doc
To: telecom <telecom@eecs.nwu.edu>
Message-ID:  <9010221915.aa19826@delta.eecs.nwu.edu>


                       BLOCKING OF LONG-DISTANCE CALLS
                              by Jim Schmickley
                        Hawkeye PC, Cedar Rapids, Iowa



     SUMMARY.  This article describes the "blocking" by one long-distance 
telephone company of access through their system to certain telephone numbers, 
particularly BBS numbers.  The blocking is applied in a very arbitrary manner, 
and the company arrogantly asserts that BBS SYSOPS and anyone who uses a 
computer modem are "hackers."

     The company doesn't really want to discuss the situation, but it appears 
the following scenario occurred.  The proverbial "person or persons unknown" 
identified one or more "valid" long-distance account numbers, and subsequently 
used those numbers on one or more occasions to fraudulently call a legitimate 
computer bulletin board system (BBS).  When the long-distance company 
discovered the fraudulent charges, they "blocked" the line without bothering 
to investigate or contacting the BBS System Operator to obtain his assistance.  
In fact, the company did not even determine the SYSOP's name.  

     The long-distance carrier would like to pretend that the incident which 
triggered the actions described in this article was an isolated situation, not 
related to anything else in the world.  However, there are major principles of 
free, uninhibited communications and individual rights deeply interwoven into 
the issue.  And, there is still the lingering question, "If one long-distance 
company is interfering with their customers' communications on little more 
than a whim, are other long-distant companies also interfering with the 
American public's right of free 'electronic speech'?"

     SETTING THE SCENE.  Teleconnect is a long-distance carrier and telephone 
direct marketing company headquartered in Cedar Rapids, Iowa.  The company is 
about eight years old, and has a long-distance business base of approximately 
200,000 customers.  Teleconnect has just completed its first public stock 
offering, and is presently (August 1988) involved in a merger which will make 
it the nation's fourth-largest long-distance carrier.  It is a very rapidly-
growing company, having achieved its spectacular growth by offering long-
distance service at rates advertised as being 15% to 30% below AT&T's rates.

     When Teleconnect started out in the telephone interconnection business, 
few, if any, exchanges were set up for "equal access", so the company set up a 
network of local access numbers (essentially just unlisted local PABXs - 
private automatic branch exchanges) and assigned a six-digit account number to 
each customer.  Later, a seventh "security" digit was added to all account 
numbers.  (I know what you're thinking - what could be easier for a war-games
dialer than to seek out "valid" seven-digit numbers?)  Teleconnect now offers 
direct "equal access" dialing on most exchanges.  But, the older access 
number/account code system is still in place for those exchanges which do not 
offer "equal access."  And, that system is still very useful for customers who 
place calls from their offices or other locations away from home.

     "BLOCKING" DISCOVERED.  In early April 1988, a friend mentioned that 
Teleconnect was "blocking" certain telephone lines where they detected 
computer tone.  In particular, he had been unable to call Curt Kyhl's Stock 
Exchange BBS in Waterloo, Iowa.  This sounded like something I should 
certainly look into, so I tried to call Curt's BBS.

     CONTACT WITH TELECONNECT.  Teleconnect would not allow my call to go 
through.  Instead, I got a recorded voice message stating that the call was 
a local call from my location.  A second attempt got the same recorded 
message.  At least, they were consistent.

     I called my Teleconnect service representative and asked just what the 
problem was.  After I explained what happened, she suggested that it must be a 
local call.  I explained that I really didn't think a 70 mile call from Cedar 
Rapids to Waterloo was a local call.  She checked on the situation and 
informed me that the line was being "blocked."  I asked why, and she "supposed 
it was at the customer's request."  After being advised that statement made no 
sense, she admitted she really didn't know why.  So, on to her supervisor.
     
     The first level supervisor verified the line was being "blocked by 
Teleconnect security", but she couldn't or wouldn't say why.  Then, she 
challenged, "Why do you want to call that number?"  That was the wrong 
question to ask this unhappy customer, and the lady quickly discovered that 
bit of information was none of her business,  And, on to her supervisor.

     The second level supervisor refused to reveal any information of value to 
a mere customer, but she did suggest that any line Teleconnect was blocking 
could still be reached through AT&T or Northwestern Bell by dialing 10288-1.  
When questioned why Teleconnect, which for years had sold its long-distance 
service on the basis of a cost-saving over AT&T rates, was now suggesting that 
customers use AT&T, the lady had no answer.

     I was then informed that, if I needed more information, I should contact 
Dan Rogers, Teleconnect's Vice President for Customer Service.  That sounded 
good; "Please connect me."  Then, "I'm sorry, but Mr. Rogers is out of town, 
and won't be back until next week."  "Next week?"  "But he does call in 
regularly.  Maybe he could call you back before that."  Mr. Rogers did call me 
back, later that day, from Washington, D.C. where he and some Teleconnect 
"security people" were attending a conference on telephone security.

     TELECONNECT RESPONDS, A LITTLE.  Dan Rogers prefaced his conversation 
with, "I'm just the mouthpiece; I don't understand all the technical details.  
But, our security people are blocking that number because we've had some 
problems with it in the past."  I protested that the allegation of "problems" 
didn't make sense because the number was for a computer bulletin board system 
operated by a reputable businessman, Curt Kyhl.

     Mr. Rogers said that I had just given Teleconnect new information; they 
had not been able to determine whose number they were blocking.  "Our people 
are good, but they're not that good.  Northwestern Bell won't release 
subscriber information to us."  And, when he got back to his office the 
following Monday, he would have the security people check to see if the block 
could be removed.

     The following Monday, another woman from Teleconnect called to inform me 
that they had checked the line, and they were removing the block from it.  She 
added the comment that this was the first time in four years that anyone had 
requested that a line be unblocked.  I suggested that it probably wouldn't be 
the last time.

     In a later telephone conversation, Dan Rogers verified that the block had 
been removed from Curt Kyhl's line, but warned that the line would be blocked 
again "if there were any more problems with it."  A brief, non-conclusive 
discussion of Teleconnect's right to take such action then ensued.  I added 
that the fact that Teleconnect "security" had been unable to determine the 
identity of the SYSOP of the blocked board just didn't make sense; that it 
didn't sound as if the "security people" were very competent.  Mr. Rogers then 
admitted that every time the security people tried to call the number, they 
got a busy signal (and, although Mr. Rogers didn't admit it, they just "gave 
up", and arbitrarily blocked the line.)  Oh, yes, the lying voice message, 
"This is a local call...", was not intended to deceive anyone according to Dan 
Rogers.  It was just that Teleconnect could only put so many messages on their 
equipment, and that was the one they selected for blocked lines.

     BEGINNING THE PAPER TRAIL.  Obviously, Teleconnect was not going to pay 
much attention to telephone calls from mere customers.  On April 22, Ben 
Blackstock, practicing attorney and veteran SYSOP, wrote to Mr. Rogers urging 
that Teleconnect permit their customers to call whatever numbers they desired.  
Ben questioned Teleconnect's authority to block calls, and suggested that such 
action had serious overlays of "big brother."  He also noted that "you cannot 
punish the innocent to get at someone who is apparently causing Teleconnect 
difficulty."

     Casey D. Mahon, Senior Vice President and General Counsel of Teleconnect, 
replied to Ben Blackstock's letter on April 28th.  This response was the start 
of Teleconnect's seemingly endless stream of vague, general allegations 
regarding "hackers" and "computer billboards."  Teleconnect insisted they did 
have authority to block access to telephone lines, and cited 18 USC 
2511(2)(a)(i) as an example of the authority.  The Teleconnect position was 
summed up in the letter:

     "Finally, please be advised the company is willing to 'unblock' the line 
in order to ascertain whether or not illegal hacking has ceased.  In the 
event, however, that theft of Teleconnect long distance services through use 
of the bulletin board resumes, we will certainly block access through the 
Teleconnect network again and use our authority under federal law to ascertain 
the identity of the hacker or hackers."

     THE GAUNTLET IS PICKED UP.  Mr. Blackstock checked the cited section of 
the U.S. Code, and discovered that it related only to "interception" of 
communications, but had nothing to do with "blocking".  He advised me of his 
opinion and also wrote back to Casey Mahon challenging her interpretation of 
that section of federal law.

     In his letter, Ben noted that, "Either Teleconnect is providing a 
communication service that is not discriminatory, or it is not."  He added 
that he would "become upset, to say the least" if he discovered that 
Teleconnect was blocking access to his BBS.  Mr. Blackstock concluded by 
offering to cooperate with Teleconnect in seeking a declaratory judgment 
regarding their "right" to block a telephone number based upon the actions of 
some third party.  To date, Teleconnect has not responded to that offer.

     On May 13th, I sent my own reply to Casey Mahon, and answered the issues 
of her letter point by point.  I noted that even I, not an attorney, knew the 
difference between "interception" and "blocking", and if Teleconnect didn't, 
they could check with any football fan.  My letter concluded:

     "Since Teleconnect's 'blocking' policies are ill-conceived, thoughtlessly 
arbitrary, anti-consumer, and of questionable legality, they need to be 
corrected immediately.  Please advise me how Teleconnect is revising these 
policies to ensure that I and all other legitimate subscribers will have 
uninhibited access to any and all long-distance numbers we choose to call."

     Casey Mahon replied on June 3rd.  Not unexpectedly, she brushed aside all 
my arguments.  She also presented the first of the sweeping generalizations, 
with total avoidance of specifics, which we have since come to recognize as a 
Teleconnect trademark.  One paragraph neatly sums Casey Mahon's letter:

     "While I appreciate the time and thought that obviously went into your 
letter, I do not agree with your conclusion that Teleconnect's efforts to 
prevent theft of its services are in any way inappropriate.  The inter-
exchange industry has been plagued, throughout its history, by individuals who 
devote substantial ingenuity to the theft of long distance services.  It is 
not unheard of for an interexchange company to lose as much as $500,000 a 
month to theft.  As you can imagine, such losses, over a period of time, could 
drive a company out of business."

     ESCALATION.  By this time it was very obvious that Teleconnect was going 
to remain recalcitrant until some third party, preferably a regulatory agency, 
convinced them of the error of their ways.  Accordingly, I assembled the file 
and added a letter of complaint addressed to the Iowa Utilities Board.  The 
complaint simply asked that Teleconnect be directed to institute appropriate 
safeguards to ensure that "innocent third parties" would no longer be 
adversely affected by Teleconnect's arbitrary "blocking" policies.

     My letter of complaint was dated July 7th, and the Iowa Utilities Board 
replied on July 13th.  The reply stated that Teleconnect was required to 
respond to my complaint by August 2nd, and the Board would then propose a 
resolution.  If the proposed resolution was not satisfactory, I could request 
that the file be reopened and the complaint be reconsidered.  If the results 
of that action were not satisfactory, a formal hearing could be requested.

     After filing the complaint, I also sent a copy of the file to Congressman 
Tom Tauke.  Mr. Tauke represents the Second Congressional District of Iowa, 
which includes Cedar Rapids, and is also a member of the House Telecommunica-
tions Subcommittee.  I have subsequently had a personal conversation with Mr. 
Tauke as well as additional correspondence on the subject.  He seems to have a 
deep and genuine interest in the issue, but at my request, is simply an 
interested observer at this time.  It is our hope that the Iowa Utilities 
Board will propose an acceptable resolution without additional help.

     AN UNRESPONSIVE RESPONSE.  Teleconnect's "response" to the Iowa Utilities 
Board was filed July 29th.  As anticipated, it was a mass of vague 
generalities and unsubstantiated allegations.  However, it offered one item of 
new, and shocking, information; Curt Kyhl's BBS had been blocked for ten 
months, from June 6, 1987 to mid-April 1988.  (At this point it should be 
noted that Teleconnect's customers had no idea that the company was blocking 
some of our calls.  We just assumed that calls weren't going through because 
of Teleconnect's technical problems.)

     Teleconnect avoided putting any specific, or even relevant, information 
in their letter.  However, they did offer to whisper in the staff's ear;  
"Teleconnect would be willing to share detailed information regarding this 
specific case, and hacking in general, with the Board's staff, as it has in 
the past with various federal and local law enforcement agencies, including 
the United States Secret Service.  Teleconnect respectfully requests, however, 
that the board agree to keep such information confidential, as to do otherwise 
would involve public disclosure of ongoing investigations of criminal conduct 
and the methods by which interexchange carriers, including Teleconnect, detect 
such theft."

     There is no indication of whether anyone felt that such a "confidential" 
meeting would violate Iowa's Open Meetings Law.  And, nobody apparently 
questioned why, during a ten-months long "ongoing investigation", Teleconnect 
seemed unable to determine the name of the individual whose line they were 
blocking.  Of course, whatever they did was justified because (in their own 
words), "Teleconnect had suffered substantial dollar losses as a result of the 
theft of long distance services by means of computer 'hacking' utilizing the 
computer billboard which is available at that number."

     Teleconnect's most vile allegation was, "Many times, the hacker will 
enter the stolen authorization code on computer billboards, allowing others to 
steal long distance services by utilizing the code."  But no harm was done by 
the blocking of the BBS number because, "During the ten month period the 
number was blocked, Teleconnect received no complaints from anyone claiming to 
be the party to whom the number was assigned."  The fact that Curt Kyhl had no 
way of knowing his line was being blocked might have had something to do with 
the fact that he didn't complain.

     It was also pointed out that I really had no right to complain since, 
"First, and foremost, Mr. Schmickley is not the subscriber to the number."  
That's true; I'm just a long-time Teleconnect customer who was refused service 
because of an alleged act performed by an unknown third party.

     Then Teleconnect dumped on the Utilities Board staff a copy of a seven 
page article from Business Week Magazine, entitled "Is Your Computer Secure?"  
This article was totally unrelated to the theft of long-distance service, 
except for an excerpt from a sidebar story about a West German hackers' club.  
The story reported that, "In 1984, Chaos uncovered a security hole in the 
videotex system that the German telephone authority, the Deutsche Bundespost, 
was building.  When the agency ignored club warnings that messages in a 
customer's private electronic mailbox weren't secure, Chaos members set out to 
prove the point.  They logged on to computers at Hamburger Sparkasse, a 
savings bank, and programmed them to make thousands of videotex calls to Chaos 
headquarters on one weekend.  After only two days of this, the bank owed the 
Bundespost $75,000 in telephone charges."

     RESOLUTION WITH A RUBBER STAMP.  The staff of the Iowa Utilities Board 
replied to my complaint by letter on August 19th.  They apparently accepted 
the vague innuendo submitted by Teleconnect without any verification; 
"Considering the illegal actions reportedly to be taking place on number (319) 
236-0834, it appears the blocking was reasonable.  However, we believe the 
Board should be notified shortly after the blocking and permission should be 
obtained to continue the blocking for any period of time."

     However, it was also noted that, "Iowa Code 476.20 (1) (1987) states, 'A 
utility shall not, except in cases of emergency, discontinue, reduce, or 
impair service to a community or a part of a community, except for nonpayment 
of account or violation of rules and regulations, unless and until permission 
to do so is obtained from the Board."  The letter further clarified, "Although 
the Iowa Code is subject to interpretation, it appears to staff that 
'emergengy' refers to a relatively short time..."

     CONSIDER THE EVIDENCE.  Since it appeared obvious that the Utilities 
Board staff had not questioned or investigated a single one of Teleconnect's 
allegations, the staff's response was absolutely astounding.  Accordingly, I 
filed a request for reconsideration on August 22nd.  

     Three points were raised in the request for reconsideration:  (1) The 
staff's evaluation should have been focused on the denial of service to me and 
countless others of Teleconnect's 200,000 customers, and not just on the 
blocking of incoming calls to one BBS.  (2) The staff accepted all of 
Teleconnect's allegations as fact, although not one bit of hard evidence was 
presented in support of those allegations.  (3)  In the words of the staff's 
own citation, it appeared that Teleconnect had violated Iowa Code 476.20 (1) 
(1987) continuously over a ten months' period, perhaps as long as four years. 

     Since Teleconnect had dumped a seven page irrelevant magazine article on 
the staff, it seemed only fair to now offer a two page completely relevant 
story to them.  This was "On Your Computer - Bulletin Boards", from the June 
1988 issue of "Changing Times".  This excellent article cited nine BBSs as 
"good places to get started".  Among the nine listed BBSs was Curt Kyhl's 
"Stock Exchange, Waterloo, Iowa (319-236-0834)."  Even the geniuses at 
Teleconnect ought to be able to recognize that this BBS, recommended by a 
national magazine, is the very same one they blocked for ten months.

     ONCE MORE THROUGH THE DO-LOOP, THEN EXIT.  The Utilities Board Staff went
through the same motions again, and came to the same conclusion, again.  
Essentially, the staff concluded that, because Teleconnect insisted that it
had evidence to justify its actions, but that evidence was competition-
sensitive and could not be revealed, the staff would have to "take
Teleconnect's word for it" and uphold the company's actions.
   
     At this point it was painfully obvious that the staff of the Utilities
Board was more than willing to buy any vapor-ware Teleconnect offered them.
The only way to get the issue out of the staff's hands and before the Iowa
State Utilities Board was to request a formal hearing.  The request was filed.

     FORMAL HEARING ORDERED.  On November 2, 1988, the Board ordered that the
complaint be docketed for a formal hearing.  After four months, it was acknow-
ledged that the "blocking" issue had sufficient substance to merit a hearing.
As of this date (November 15, 1988), the case has not been assigned to an 
Administrative Law Judge, nor has a hearing date been set.

     THE SECOND FRONT OPENS.  A few months ago, we were able to verify that
Teleconnect was blocking interstate (Iowa to Illinois, in this case) calls,
and a complaint was filed with the Federal Communications Commission (FCC).
In late October, the FCC informed Teleconnect of the complaint, and ordered
Teleconnect to respond. 

     While it appears that this also could be a slow process, it is expected 
that the FCC will much more responsive that the staff of the Iowa Board, for
whom this was a very new issue.  In addition, Congressman Tom Tauke has 
expressed his interest in the matter.  Mr. Tauke, representing the Second
District of Iowa (including Cedar Rapids), is a member of the House
Telecommunications Subcommittee, and was recently reelected for a sixth term.

     Recently, we have been able to verify that Teleconnect is blocking two
other eastern BBS lines.  It might be possible to use these verifications to
establish a pattern to escalate the FCC complaint to formal complaint status.
  
     STATUS.  And now, as of November 15, 1988, here's where we are:

     We are starting to prepare questions for an interrogatory to Teleconnect
for the Iowa hearing.  Finally,  after six months, we finally have hopes of
getting straight answers (or even any answer) to questions on blocking.  We
will try to keep you informed (through BBSs, etc.) about the hearing date, as
soon as it is scheduled, and other developments.

     We are also beginning to run up some expenses, and need the help of
concerned groups and individuals in defraying expenses in this fight for
communications freedom.  An expense fund has been authorized by Hawkeye PC,
and will be administered by the treasurer.  Contributions are requested to be
sent to:  Hawkeye PC Users' Group, Anti-Blocking Expense Fund, c/o Pat Alden,
Treasurer, 840 Maggard, Iowa City, Iowa  52240.
       	
     The complaint on the interstate aspect of the blocking problem is just
beginning to slowly wend its way through the FCC.

     Teleconnect has effectively completed its merger.  Now, it is a major
component of a new company, Telecom*USA, which is the fourth largest American
long-distance company.  This company now has long-distance operations in over
half of the states plus the District of Columbia.

     Curt Kyhl, whose Stock Exchange BBS was blocked by Teleconnect for ten
months (June 1987 to April 1988) even though they didn't even know his name,
has accepted a new business opportunity and moved to Des Moines.  Curt is
now operating his excellent BBS at (515) 226-0680.

     And, in an unexpected development, Teleconnect Vice President for 
Customer Service, Dan Rogers, has requested an opportunity to discuss the
company's "blocking policy".  He is scheduled to do so at Hawkeye PC's
November 28th meeting in Iowa City.

     UPDATE, January 4, 1989:

     Dan Rogers addressed Hawkeye PC in Iowa City on Nov. 28th.  To summarize,
the assembled members did NOT accept Teleconnect's explanation that blocking
was necessary to protect revenues for the good of all their customers.  The
assembled group included professional people, university students, and four
Sysops, Ben Blackstock, Al Chapman, John Friel III (author of QModem), and
John Oren.  It appeared Dan Rogers was impressed by the fact that this was
not a group of hackers (a term which Teleconnect had been bandying about
rather freely.)  The high point of the evening was an eloquent sermon
delivered by John Oren, in which he pointed that the idea of "the greater good
of all" to the disadvantage of individuals did not work for Immanuel Kant, and
it certainly wasn't going to play for Teleconnect.

     On December 19th, Bruce Wilson and I participated in a pre-hearing
conference before an administrative law judge in Des Moines as the initial
step in the formal complaint procedure with the Iowa Utilities Board.  Casey
Mahon, Teleconnect's senior vice president and general counsel, represented
the company.  Curt Kyhl, Sysop of the Stock Exchange BBS, attended as a very
interested observer.  The judge gave instructions to the attorneys to reduce
the significant points of the case to writing and report back to him on Jan.
18th.  He also suggested that a rules-making procedure would be in order to
establish rules by which the Utilities Board could decide any future cases of
this type which it might encounter.  Bruce Wilson had already prepared a 
rules-making petition for filing at a later time.  (The rules-making petition
will be filed as soon as this complaint is resolved.)

     Following the conference, Bruce Wilson, Casey Mahon, Curt Kyhl, and I met
informally and discussed possible resolution of the complaint.  There is a
reasonable expectation of reaching an "out of court" resolution of the issue
without compromising the principles involved.  Regrettably, however, nothing
further along the line of a settlement has occurred in the ensuing two weeks.

     On December 22nd, I set up my computer in the offices of Teleconnect, 
and demonstrated communication via modem to Dan Rogers and some of his
security staff.  The intent was to make those people much more knowledgable
of modems and BBSs, and they seemed to be genuinely impressed by the
professional quality of the boards I called.  We also had an extensive 
discussion on the high standards, caller verification, and self-regulation 
practiced by the Sysops.

     Meanwhile, in Washington, Teleconnect's D.C. law firm had replied to the
FCC on the interstate blocking complaint I had filed.  The response was,
unfortunately, a rehash of the same generalizations and pleas of "revenue
loss" which they had submitted to the Iowa Utilities Board.  The FCC has not
acted yet, but there is some indication that they recognize that they have
never before received a complaint of this type, and it could become a 
precedent setter to some extent.

     And, the situation is now receiving national publicity.  Senior Editor
Art Brodsky of "Communications Daily" read about it on a BBS, and contacted me
for more information, as well as checking with the FCC.  He wrote an excellent
article which was published on December 16th.  Dana Blankenhorn picked up on
Mr. Brodsky's article and published an item in NEWS BYTES, an on-line service
of The Source.  It appears now that other publications will also pick up the
story.

     Meanwhile, we are preparing to continue with the formal hearing before
the Iowa Utilities Board's administrative law judge.




Received: from zeus.unomaha.edu by delta.eecs.nwu.edu id aa29299;
          22 Oct 90 19:17 CDT
Date: 22 Oct 90 18:24:00 CDT
From: JOHN WINSLADE <winslade@zeus.unomaha.edu>
Subject: bwletter.txt
To: telecom <telecom@eecs.nwu.edu>
Message-ID:  <9010221917.aa29299@delta.eecs.nwu.edu>

                                   Bruce L. Wilson
                                   Attorney at Law
                                   677 - 61st Street
                                   Des Moines, Iowa 50312
                                   (515) 277-4904 (voice)
                                   (515) 280-9107 (data)
     
                                   June 26, 1988
     
     
     
Mr. Arnold H. Garson
Managing Editor
Des Moines Register
715 Locust Street
Des Moines, IA 50309
     
Re: "Electronic hotshots are suffering terminal addiction," by
     Patrick Beach, illustration by Tom Weinman, page 1-T, Satur-
     day, June 25, 1988, 
     
Dear Mr. Garson: 
     
     Unfortunately for most users and operators of computer bul-
letin board systems, Mr. Beach, not being a computer user him-
self, wasn't able to thoroughly research his story before writing
it.  I've spoken with Mr. Beach, who now realizes that he has
only seen the tip of a very large and diverse iceberg.  Just as
the exposed portion of an iceberg can be deceiving, he was quite
mislead by his minimal exposure to today's computer bulletin
board systems.  
     Most bulletin board users and system operators are male, but
more and more women are becoming involved with computers and con-
currently with computer bulletin boards.  One Des Moines area
board is operated by a mother and daughter, something which, if
not unique in the entire U.S., is quite uncommon. 
     Although it's not as evident around here as in other parts
of the country, attorneys have probably made the greatest use of
computer bulletin board systems of any profession.  The American
Bar Association's ABA-net is a computer bulletin board system. 
     A seminar on computer bulletin boards was part of this
year's annual meeting of the Iowa State Bar Association. 
     There are systems operated by bar associations and indivi-
dual lawyers all over the country and a number of articles about
them have appeared in the National Law Journal.  Operators in-
clude DePaul University College of Law, the Houston North Bar
Association, and the Lawyers' Microcomputer User Group (LawMUG)
in Chicago, whose was the first lawyers' computer bulletin board
system in the country.  
     Many systems are operated by governmental agencies at both
the state and Federal level.  The Iowa Department of General Ser-
vices operates one.  The U.S. Department of Education operates
one with a nation-wide toll-free number for educators to communi-
cate with each other.  
     At least one newspaper operates a bulletin board, as shown
by the following message, posted on another system: 
     
     Date: 06-24-88 (02:53)         Number: 545
       To: ALL                      Refer#: 550
     From: DAVID LEVINSON             Read: (N/A)
     Subj: HOWDY                    Status: PUBLIC MESSAGE
     
     If you have an urge to tell Southern Californians a
     thing or two -- advice on earthquakes, voting in Novem-
     ber as well as more laid-back topics is always welcome
     -- call The Electric Newspaper at 213-432-3592.  We're
     PC Pursuitable at 1200 baud.  We run PC Board 12.1/D
     but don't have much in the way of files.  Our primary
     interest is letters to the editor and freelance arti-
     cles for our op-ed page at the Long Beach Press-Tele-
     gram, a Knight-Ridder newspaper (like the Miami Herald,
     but there is a good deal less of us).  
     
     There are literally thousands of computer bulletin board
systems scattered across the country.  Some are organized in net-
works which exchange messages, allowing someone in Des Moines to
engage in roundtable discussions with others in all parts of the
country by entering his or her message on the local board, for
example.  
     Boards in over 25 major U.S. cities can be called cheaply
and directly from Des Moines by using a service of Telenet called
PC Pursuit.  For a flat fee of $25 a month, Telenet allows its
data lines to be used at night and on weekends, when they'd
otherwise be idle. 
     All it takes is a local call to connect to Telenet and
through it to Chicago, Boston, Dallas, Miami, Los Angeles, Port-
land, New York City, DC, or any other "PC Pursuitable" city. 
     Bulletin board systems serve as a means of distribution for
high-quality computer programming, comparable to anything found
on the shelves of computer stores and in some cases superior to
it.  The concept is known as "shareware," which enables program-
mers to inexpensively distribute their work and users to "try
before you buy." 
     Shareware programs include spreadsheets comparable to Lotus
1-2-3, data base management programs comparable to DBase III, and
word processing programs comparable to WordPerfect, all commer-
cial programs retailing for hundreds of dollars.  
     Authors of shareware programs transmit (upload) them to the
bulletin boards.  Board users receive (download) them, use them,
and only send a nominal payment if they choose to keep and con-
tinue to use them beyond the trial period.  
     Unlike that to which Mr. Beach was exposed, the vast majo-
rity of computer bulletin boards do not permit the use of any-
thing but verifiable real names.  Some use elaborate procedures
to assure the operator that a user is, in fact, who he or she
claims to be.  
     Even if the use of "handles" is permitted, the exchange of
copies of commercial software or information about illegal or
questionable activities is not.  
     The operators of these systems may have thousands of their
own dollars invested in the hardware and software.  They spend
many hours in the operation and maintenance of their systems and
are not about to risk losing it all.  
     A number of system operators showed their concern on May 7
by attending a conference in Chicago on the legal aspects of run-
ning and using their systems.  Paul Bernstein, founder of LawMUG,
summarized the conference on the LawMUG board and in its online
newsletter: 
     
          On Saturday, May 7, 1988, The John Marshall Law
     School Center for Informatics Law and LAWMUG co-spon-
     sored a conference for electronic bulletin board opera-
     tors to examine possible liability exposure in opera-
     ting a board.  People traveled from as far as Washing-
     ton, DC, Arizona, Iowa, Michigan, Indiana, and Tennes-
     see, for the day-long conference held at the Law School
     in Chicago. 
          The Center is exploring the possibility of serving
     as a law clinic resource for sysops with specific legal
     questions concerning the operation of their boards.  
          It was founded at The John Marshall Law School in
     1983.  It examines information and communications tech-
     nologies in the context of our legal system, with em-
     phasis on the protection of personal privacy and human
     dignity in today's information-oriented environment.  
          Professor Trubow has been professor of law at The
     John Marshall Law School since 1976 and is Director of
     the Center.  He teaches torts and seminars on privacy,
     computer law, and information law and policy.  He was
     general counsel from 1974-76 to the Committee on the
     Right of Privacy, Executive Office of the President.
          Professor Trubow and Paul Bernstein, Esq., began
     the conference with an overview of the principal legal
     problems facing sysops.  He presented an examination of
     federal and state civil law and regulation.  
          Cathy Pilkington, Esq., Counsel to the Inspector
     General, Illinois Department of Public Aid, spoke on
     computer crime.  Ms. Pilkington, a principal drafter of
     Illinois' new Computer Crime Prevention Law, frequently
     prosecutes cases of computer abuse.  
          A panel of attorneys and system operators presen-
     ted alternative views on how "sysops" should conduct
     their systems to minimize liability exposure in the
     afternoon.  Professor Trubow moderated the discussion
     and posed questions for the panelists to consider. 
     
     Dan Buda, operator of the board sponsored by the local chap-
ter of the First Osborne (user) Group (FOG), Jim Borchard, opera-
tor of the Iowa DGS board, and I attended this conference.  
     I suggest you arrange to provide Mr. Beach with an IBM or
IBM-compatible personal computer, modem, and a subscription to PC
Pursuit (or access to a nation-wide WATS line), so that he can
fully explore the range of resources provided by bulletin board
systems and develop a more accurate image of what they are.  I
would be happy to provide a copy of an excellent shareware com-
munications program, directories of bulletin board phone numbers,
and technical advice to get him started.  (The commercial com-
munications programs are a major waste of money.)  
 
                                   Sincerely, 
 
 
 
                                   Bruce L. Wilson




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          22 Oct 90 19:34 CDT
Date: 22 Oct 90 18:25:00 CDT
From: JOHN WINSLADE <winslade@zeus.unomaha.edu>
Subject: iowa.sto
To: telecom <telecom@eecs.nwu.edu>
Message-ID:  <9010221934.aa25979@delta.eecs.nwu.edu>

Jim:

Here's what I wrote about your discussions with Teleconnect.

Dana Blankenhorn

PHONE COMPANIES are trying to crack down on pirate BBS systems, 
and getting on legitimate users' nerves. An informal complaint 
before the FCC asks it to decide basic issues involving the 
rights of phone companies to refuse to serve Bulletin Board 
Systems (BBSs). James Schmickley of Cedar Rapids, Iowa asked for 
the ruling after Teleconnect of Cedar Rapids, a long-distance 
carrier now owned by SouthernNet of Atlanta, blocked his call to 
a Waterloo BBS in April.  Teleconnect's disconnect was based on 
what General Counsel Casey Mahon called "its good-faith belief 
that theft of Teleconnect services was being accomplished through 
misuse of the number by parties unknown to Teleconnect." The 
threat -- that all BBS operators would be refused service because 
hackers use their systems to commit crimes -- needed to be 
addressed, thought Schmickley. 

Schmickley told the Hotline his own case may be on its way to a 
solution. "We had a pre-hearing conference before an 
administrative law judge in Des Moines this past Monday, the 
19th." Schmickley is represented by Bruce Wilson, a former Iowa 
board staff member, a lawyer, and co-SYSOP of the Cirus 
Cybernetics board in Des Moines. Mahon represented Teleconnect. 
The judge asked for a list of facts by January 18, and asked 
the parties to talk things over. It looks now, Schmickley adds, 
"like we'll be able to talk this out." Teleconnect blocks on The 
Stock Exchange and Computer Direct in Barrington, IL, another 
reputable board Schmickley had been blocked from calling, were 
removed. 

"I know I can go through AT&T," and make calls Teleconnect 
won't, Schmickley concludes. "I'm an engineer, I'm not totally 
stupid. But what kind of games are we going to play -- I refuse 
to operate that way." God bless you, Jim Schmickley. 


NOTE:  This is a news story written by Dana Blankenhorn for NEWS
       BYTES, an on-line news service of The Source.



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          22 Oct 90 20:01 CDT
Date: 22 Oct 90 18:25:00 CDT
From: JOHN WINSLADE <winslade@zeus.unomaha.edu>
Subject: flatt-01.txt
To: telecom <telecom@eecs.nwu.edu>
Message-ID:  <9010222001.aa27819@delta.eecs.nwu.edu>

            Fron Andy Flatt's NightHawk BBS, Bulletin #7, 9-7-88
          ========================================================

Why YOU should be concerned with Teleconnect's long-distance policies, or,
"Why, in my view, Teleconnect is scum".

If you use Teleconnect for your long-distance calls, OR if you give a damn
about the First Amendment, read on.  It's only a couple screens long.

Basically, the short version of the story is: Teleconnect has admitted to
blocking calls through its system to certain BBS systems because at least once
a hacker has used an unauthorized access code to call those systems.  (The long
version of all this is contained in BLOCKERS.ARC and BLOCKER2.ARC;  download
these for specifics on the case.)

"So what?" you may be saying.  Think about it.  For reasons that Teleconnect
only has to justify to themselves, they decided to prohibit certain calls from
being placed through their system, on the grounds that SOME calls have at one
time been made fraudulently.

Specifically, one or more people had (according to Teleconnect) figured out how
to hack a seven-digit "access code" and used it to call various BBSs.  One of
these was Curt Kyhl's Stock Exchange BBS in Waterloo.  So, in response to the
fraud, Teleconnect took the easy way out.  Rather than try to identify the
fraudulent caller, and (and this is the big one) RATHER THAN COOPERATE WITH THE
SYSOP in finding the caller, they simply told their switch not to complete ANY
calls to the number.  And, they gave the caller a recording saying "this is a
local call from your dialing area".  (Yeah, sure.  They won't even ADMIT they
refuse to place the call, causing confusion to the caller.)

AND, Teleconnect NEVER even told Curt Kyhl that they were taking this action.
In fact, they have admitted that they never even completed a CALL to the
number, to see whose number it was they were blocking!!

So, here we have a "common carrier", a utility allegedly regulated by the ICC,
DECIDING FOR ITSELF who it will place calls to.  In this case, it was a BBS
they blocked calls to.  (In Teleconnect's eyes, people who call "computer
billboards" [their words] are all hackers, anyway.)  But do they have the
right to prohibit free and uninhibited exchange of information between honest
parties?

And related to this whole argument is the question: Why is it BBSs have such a
strange reputation?  Because we're esoteric?  Nobody has much sympathy for
"computer geeks" with pale skin and green eyes, anyway, I guess.

But I tell ya what.  If Teleconnect (just as arbitrarily) decided to block
calls to a pool hall, for whatever reason, would that be right?  What if they
decided not to place a call to Mr. XXXXX because he worked for AT&T?  Or
because he were black?  But it was "just a BBS".  So that's OK.

There's a dangerous precedent being set here, gang.  Believe me, I do NOT
support toll fraud.  It is wrong, and it is theft.  And violators should be
punished.  But dammit, Curt Kyhl and his BBS had NOTHING to do with the theft.
He should not have incoming calls restricted due to the actions of some
criminal third party.

And I think, on top of all this, Teleconnect's lack of cooperation with the
Commission, and to its customers who demanded an explanation (myself included)
of its blocking policies, stinks!

So, download BLOCKERS.ARC and BLOCKER2.ARC and read the specifics.  If this
bothers you, then write that letter!  But by God, don't take this sitting down.
I'm not a troublemaker or a hell-raiser, but this kind of power-wielding must
be stopped, and it's gonna take grass-roots resistance to make a dent.

At the very least, call Teleconnect toll-free at 1-800-REACH-US and ask for
Dan Rogers.  Explain to him that you're a law-abiding, legal, legit person...
AND you call BBSs.  And ask him to explain why and how they block calls.  Make
him justify and explain their position to you.  (They don't think many people
even KNOW about this policy!)  Don't take a flunkie or a customer service type
for your answer;  ask for Dan Rogers.  Give 'em hell.  And WRITE THAT LETTER!
We need political clout in this one, too.

Finally, if you have any comments or suggestions, leave an open message here.
(Have you ever gotten that recording about it being a local call, even when
it was not?)

Oh, and if you read this far, you get extra credit points for putting up with
me.  Thanks!




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          22 Oct 90 20:01 CDT
Date: 22 Oct 90 18:25:00 CDT
From: JOHN WINSLADE <winslade@zeus.unomaha.edu>
Subject: gannett.bbs
To: telecom <telecom@eecs.nwu.edu>
Message-ID:  <9010222001.ab27819@delta.eecs.nwu.edu>

                             
                                    
                                      
                    
                                             
                                     
     
          This Bulletin Board is sponsored by the Gannett Co., Inc.     
          We operate 24 Hours a day, 7 days a week at (703)524-3982     
      
       For all Gannett/USA Today Employees, and other computer users.   
        The Gannett Information Center,  the 23rd floor of Tower II.    
      
    
    
      Bulletin 1 - Upload Download Statistics.  Just be fair.....         
      Bulletin 2 - A short message on current Board Procedures.           
      Bulletin 3 - You can now upload your resume for Gannett or USA Today
      Bulletin 4 - Letter to our users.                                   
    
 
 
                    Welcome to the Gannett Help Screen                       
                                                                             
    As you are a new user, we will ask that you register before access       
    is granted.  You will be able to look around the board on this first     
    call, register for access and leave a comment to the Sysop.              
                                                                             
    Gannett Co., Inc. callers can call Bob Ison at x6113 to be               
    granted immediate access. You will still need to register during         
    this first call.                                                         
                                                                             
    Please leave comments to the Sysop concerning improvements you would     
    like to see on this system.  All comments are appreciated.               
                                                                             
 
 
 
                 Note! Now 20 Meg IBM XT for the Help Screen BBS...
 
 
                           Our system now consists of:
                                   IBM PC/XT
                          Color Graphics Adapter/Monitor
                            One 20 Meg IBM Fixed Drive
                            Hayes 2400 Baud SmartModem
 
 
    20 Megs
    Online!                Running PCBoard Software
                                24 hours a day..
                                 7 days a week!
 




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          22 Oct 90 23:58 CDT
Date: 22 Oct 90 18:23:00 CDT
From: JOHN WINSLADE <winslade@zeus.unomaha.edu>
Subject: brodsky1.txt
To: telecom <telecom@eecs.nwu.edu>
Message-ID:  <9010222358.aa06094@delta.eecs.nwu.edu>


COMMUNICATIONS DAILY                                        Warren Publishing
The Authoritative News Service                                     43
of Electronic Communications                               Years of Excellence
------------------------------------------------------------------------------
A Service of Warren Publishing, Inc.
           2115 Ward Court, N.W., Washington, D.C. 20037.  Phone: 202-872-9200
------------------------------------------------------------------------------

FRIDAY, DECEMBER 16, 1988                                      Vol. 8, No. 242

Today:

FCC ASKED TO SET COMPUTER BULLETIN BOARD BLOCKING:  Ia. consumer argues Tele-
connect wasn't right in blocking board called with stolen number.  Teleconnect 
says blocking is necessary to cut losses.  (P. 3)


Preventing Income Loss
----------------------
           FCC ASKED TO CONSIDER BULLETIN-BOARD BLOCKING COMPLAINT 

     FCC has been asked to decide complaint that involves fundamental issues 
surrounding nature of computer bulletin board (BBS) operations, ability of 
carriers to protect themselves from theft, and when blocking of services is 
appropriate.

     Informal complaint was filed by James Schmickley, engineer with Rockwell 
International in Cedar Rapids, Ia., who took the case to FCC after having been 
rebuffed at Ia. Utilities Board.  Case started in April when Schmickley tried 
to call Stock Exchange bulletin board in Waterloo, Ia., and found call blocked 
by Teleconnect, his long distance carrier.  Teleconnect Gen. Counsel Casey 
Mahon told Schmickley's attorney, Benjamin Blackstock, in April 28 letter that 
company had blocked number to bulletin board "in its good-faith belief that 
theft of Teleconnect services was being accomplished through misuse of the 
number by parties unknown to Teleconnect."

     Schmickley was advised to dial 10288, area code and local number or to 
change long distance carrier.  Mahon's letter didn't mention that 10288 is 
equal access code for AT&T.  (Mahon later disclosed that information in 
correspondence to Ia. Utilities Board, which looked into issue.)  Mahon added 
that while Schmickley said Curtis Kyhl, system operator of Stock Exchange, is 
responsible individual, "even reputable operators of computer bulletin boards 
cannot always prevent 'hacking' by others."  Teleconnect said it couldn't 
determine identity of bulletin board operator.

     Teleconnect kept block on for 10 months, telling Ia. Utilities Board in 
July 29 letter that company "Had suffered substantial dollar losses as a 
result of the theft of long distance services by means of computer 'hacking' 
utilizing the computer billboard [sic] which is available to that number."  
Mahon advised Utilities Board:  A computer billboard can be used in other ways 
to facilitate theft of long distance services."  Board on Aug. 19 agreed with 
Teleconnect, saying that company could block lines in emergency situation and 
that carrier's response "appears to suggest that there was an emergency due to 
revenue loss.  The company chose to reduce the service to this one number by 
blocking calls through its system."

     Schmickley took same complaint to FCC Sept. 19, citing blocking not only 
to Stock Exchange bulletin board, but also on interstate call Sept. 14 to 
computer buying service bulletin board.  He said question is whether carrier 
has right to block bulletin board, which is a computer service, because of 
other unrelated computer activities:  "If they can do as they damn well 
please, it's a serious threat to free communications."  He said responses from 
Teleconnect and Ia. regulators indicate lack of understanding of computer 
communications.  In Dec. 2 response to Schmickley, Teleconnect said it tried 
to contact Stock Exchange bulletin board, but couldn't "because of software 
incompatibility."  He responded:  "That's a crock."  He noted that Stock 
Exchange number had been published in June 1988 issue of Changing Times 
magazine as "a good place to get started," and said Teleconnect had never 
exhibited good-faith effort to identify source of problem.

     Schmickley noted that first screen on Stock Exchange lists Kyhl as system 
operator, so that fact should have been easy for Teleconnect to determine.  
Number in Barrington, Ill., that Teleconnect blocked was to Computer Direct 
Inc., which sells computer equipment.  Printout of screens from Computer 
Direct show that it has posted rules that include:  (1) "NO [emphasis by 
author] conversations involving Phreaking (defrauding the phone company)."  
(2) "NO conversations involving defrauding any other Company."  Conferences 
include Christian Ethics discussion, and users are logged off with quotation 
from Bible.

     For Teleconnect, issue is protection of network and defense against 
revenue losses.  In Dec. 2 response to Schmickley's informal complaint, 
company said blocking is required to prevent "fraudulent use of the network by 
computer 'hackers.'"  Its actions were "neither arbitrary nor wrong," 
Teleconnect said, noting that calls to bulletin boards at issue "exhibited 
patterns which clearly indicated that theft of telecommunications services was 
occurring."  Teleconnect said it blocks calls "only when clear signs of 
hacking and other unauthorized use are present."  It said its regulations on 
blocking are reasonable.  Citing Carlin Communications v. Mountain Bell dial-
a-porn case, Teleconnect added that "carrier may institute blocking even if 
the offending access is not illegal."


                             ***********************************************
                             *  The preceding article by Senior Editor     
                             *  Art Brodsky was reproduced by permission.  *
                             ***********************************************




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          23 Oct 90 2:41 CDT
Date: 22 Oct 90 18:24:00 CDT
From: JOHN WINSLADE <winslade@zeus.unomaha.edu>
Subject: chgtimes.doc
To: telecom <telecom@eecs.nwu.edu>
Message-ID:  <9010230241.aa27237@delta.eecs.nwu.edu>


               The following article about Computer bulletin
               boards appeared in the June, 1988 issue of
               The Kiplinger Magazine "CHANGING TIMES"



<<<  Note:  The STOCK EXCHANGE, listed in Waterloo, has been
            relocated to Des Moines, Iowa (515-226-0680)
            because SYSOP Curt Khyl has changed jobs.
  



ON YOUR COMPUTER


BULLETIN BOARDS
        Computer bulletin boards get a bad rap.  If you've never 
explored one, they must seem b-o-r-i-n-g---a bunch of hacker nerds 
earnestly arguing through their PCs the merits of Intel's 80386 chip 
over Motorola's 68020 or engaged in other trivial pursuits.  Too bad,
because for the computer owner the bulletin board (or BBS) is heaven
on earth---a quick source of thousands of software programs.  All of
them yours for the asking.  All of them free, or the next thing to it.

	If these programs were just games or new ways to count the 
number of angels that can dance on the head of a pin, you could 
dismiss the hundreds of BBSs.  But ask yourself:  If you (or your 
college-bound child) needed a good writing program, would you rather 
pay $360 for MultiMate or $250 for WordPerfect, or grab any one of 
numerous full-feature writing programs from a bulletin board and pay 
little or nothing?  If you wanted to catalog your recipes or wines, 
would you rather pay $400 for dBase III (and struggle with its 
complexities) or grab PC-File from a BBS and accomplish the same, 
gratis?  The same goes for communications programs, spreadsheet 
programs, investment programs, tax programs and any number of 
utility programs that improve your computer's operation or add to 
its friendliness.

WHAT YOU'LL NEED.
        One special piece of hardware is necessary:  a modem, the 
device that allows your computer to talk to another computer via 
telephone lines.  Modems, which can be freestanding or installed 
inside a computer, sell for $100 to $500, depending on their speed, 
or baud rate.  Avoid the cheapest modems, which operate at 300 bauds, 
or 300 bits of data per minute.  Buy a 1200-baud, or a 2400-baud if 
you can, because the higher speeds save time and long-distance bills.

	To run the modem, you'll need a communications program, too.  
Some good ones, such as ProComm, are offered on bulletin boards.  
So before spending more money, borrow a friend's communications 
software, use it to call a BBS or two, and see whether a program 
offered on one of them suits your needs.  For most boards, you 
should set communications parameters in the software to eight 
data bits, one stop bit and not parity.

WHAT YOU'LL FIND.  
        Now you're ready, but how do they work?  Most BBS cost 
nothing to use.  The programs themselves are free, too, although 
some are what's called shareware---if you find the software useful, 
you send a nominal sum to its creator and become a registered user. 
Some flawed programs appear on the boards, but a great deal of what 
you'll find is superior to commercial software and is regularly 
updated.  It's up to you to separate wheat from chaff.

	You've got a friend when it comes to that task.  Quality 
control is just one of the duties performed by the SYSOPs--
-system operators---who monitor the contents of their bulletin 
boards.  They SYSOPs are generally computer enthusiasts who run 
their BBSs on a nonprofit basis.  Their ranks include programmers, 
hobbyists and professional organizations that operate BBSs for 
members and newcomers alike.  Good SYSOPs are professional and 
are often available for on-line chats.  They also provide etiquette 
guidelines---no pseudonyms, profanity or libel--to new users.  Some 
SYSOPs verify your identity and, if you disobey the rules, will 
deny you access.  A few charge annual membership fees in the $15 
to $50 range.

	Don't feel intimidated about plunging in.  Most boards are 
quite easy to use.  They use menu-driven instructions and prompts.  
It's a good idea to write down or print the main menu or exit 
instructions, in case you get lost in a maze of commands.  to 
minimize download time and to pack all files associated with a 
program together, boards squeeze them into an "archive" file that 
carries the extension ".ARC."  To unsqueeze and unbundle them, you'll 
need a special program.  The best of the lot---usually found under 
the name PKX35A35.EXE---is available on most bulletin boards.  Make 
this the first program you transfer to your computer and save it.

	The boards mentioned below are good places to get started 
on your search for BBS gold.  A few are exceptionally large general
-interest boards, and the others will appeal to investors and users 
of financial software.  Unless state otherwise, all are for IBM-style 
personal computers.

	THE MARKET, Potomac, Md. (301-299-8667).  Its 20 directories 
of files include sections on home finance (amortization, retirement 
and real estate program), business logos, letters and sales-tracking 
systems) and investment programs (stock valuation and tracking with 
buy and sell signals).  There are also utility programs for such 
things as hard disks and keyboards.  Don't look for games here.

	INVESTOR'S ONLINE, Bellevue, Wash. (206-285-5359).
This service is devoted almost entirely to the stock market.  
SYSOP Don Shepherdson says the board serves as in "idea exchange" 
for investors.  He also makes available 235 files for registered 
users.

	COMPUTERIZED INVESTING, Chicago (312-280-8764).  Run by 
a magazine published by the American Association of Individual 
Investors, it offers more than 200 programs that emphasize investing,
portfolio management, valuation and amortization calculations and 
investment analysis.  There are separate libraries of files for 
IBM, Apple, MacIntosh and Commodore users.

	TAX ASSISTANCE, Arlington, VA (703-237-8430).  
It's nicknames "Ask Roger," because Washington, D.C., 
CPA Roger Stanley answers questions about tax matters for his 
registered users.  Early in 1988 he put software on his BBS for 
preparing federal, Maryland, Virginia and D.C. tax returns for 1987 
(asking $25 to $50 for its use).  There's loads of other free tax 
and business software available on this superb BBS.

        STOCK EXCHANGE, Waterloo, Iowa (319-236-0834).  
Nearly 1,000 files are organized under ten general headings, 
including a section devoted to financial applications for Lotus 
spreadsheets.  It also offers dozens of demonstration programs of 
commercial financial software and more than 100 other finance and 
data programs, including market averages and mutual fund rankings.

	STOCKS 'N' SUCH, Madison, N.J. (201-377-2526).  
It holds 17 file areas, including ones devoted to finance, 
accounting, business and marketing.  For a break, check out 
the files on humor, music and color pictures.  Despite the name, 
there's something for everyone.

	ROYALINK I, Westlake, Cal. (805-484-9343).  
Here's a top-notch, general-interest BBS on the West Coast that 
offers more than 900 files, divided into 16 categories, from games 
to utilities.

	The FILE CABINET, Philadelphia (215-678-9334).  
Aptly names, it contains more than 7,700 files and has nine phone 
lines to handle incoming calls.  files are organized by the year of 
their release.  This BBS covers the entire range of computer software.

	RAILROAD BBS, Long Island, N.Y. (516-741-6914).  
Another enormous East Coast BBS, it offers more than 600 utility 
programs, plus hundreds of others dealing with communications, 
word processing,data-base management and computer languages.  
But it's light on business and financial software.  An the only 
program we found relating to choo-choos was a game that lets you 
control an imaginary model railroad layout.

	For other BBSs, we found the most up-to-date list of boards 
for users of IMB-style PCs on the BBS run by PC Magazine.  Download, 
or receive, its list (and numerous free utility programs) by calling 
212-696-0360 on the East Coast or 415-598-9100 in the West.  Apple 
owners can get help finding a local BBS by calling the Apple user 
group's hot line at 800-538-9696.

	If wanderlust won't let you settle for a local BBS, a way 
to avoid sky-high long-distance bills if Telenet's PC Pursuit 
service.  For a one-time registration fee of $25 plus $25 a month, 
billed to your credit card, you can call bulletin boards in 25 major 
cities during evenings and weekends.  It takes longer to transfer 
data using PC Pursuit, but you're paying only the flat fee.  For 
more information, call 800-835-3638 or dial the PC Pursuit BBS 
at 800-835-3001.

	One more caveat---if possible, disable call waiting while 
you're on-line; otherwise, an incoming call will break your 
connection with a BBS.  Check with your local phone company to see 
whether "cancel call waiting" is available.

A WAY TO TALK
        How easily you can talk with computer bulletin boards hinges 
in part on the software you use to do the talking.  Expensive 
communications program like Crosstalk and Smartcom, both of which 
cost more than $200 but are often discounted, do the job well.  Yet 
why spend the money when there's ProComm, a "shareware" program 
available on the boards?  It costs you nothing to try and just $25 
to become a registered user.

	We gave version 2.42 of ProComm a torture test while 
preparing the above item on bulletin boards, and we award it 
high marks.  It's slickly put together, with "exploding" screens 
and sound effects.  More to the point, it's a breeze to use.  
The instructions occupy 106 pages when printed, but we got it up 
and running without ever looking at them.  When you seek to transfer 
a file from a BBS to your computer, ProComm prompts you through the 
steps---you couldn't ask for an easier way.  And experienced 
computer users can construct special files that automatically 
log them on to particular boards or data bases they use regularly.

	PC-Talk, the granddaddy of shareware communications programs,
now costs $100.  ProComm goes it one better in cost, utility and 
ease of use.  You can find the program on numerous bulletin boards, 
including Royalink I (see above) and ProComm's own BBS (314-449-9401).
Or register and obtain disks directly from Datastorm Technologies, 
Box 1471, Columbia, Mo  65205, for $10/disk.


By Marshall Rens
Research:  Joan Goldwasser
The Kiplinger Magazine
CHANGING TIMES
1729 H Street, N.W.
Washinbgton D.C. 20006





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From: "Michael H. Riddle" <riddle@hoss.unl.edu>
To: telecom@eecs.nwu.edu
Subject: Follow-up to Teleconect Call Blocking in Iowa
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Status: R


Bruce L.  Wilson, Esq.,  a BBS-literate attorney in Des Moines, Iowa, 
who represented  Jim Schmickley  in the  formal complaint proceedings 
before the  Iowa Utilities  Board against  Teleconnect concerning its 
blocking activities, was gracious  enough  to  provide  the following 
update for us:  
  
"I didn't review it in great detail, but the 'special edition'appears 
to be primarily the text files which Jim Schmickley wrote  and uploa- 
ded as  BLOCKER.ARC and  similar names, with the last dated reference 
being December 22, 1988.  I  don't know  what, if  anything, happened 
after that  with respect  to the FCC complaint.  As far as that filed 
with the Iowa Utilities Board, a  chronological listing  of what took 
place until  the complaint  was finally dismissed in September, 1990, 
follows this discussion.  The reason for that dismissal was  that the 
Board had  effectively given all the prospective relief Jim could ask 
for and expect to get from the complaint proceeding by adopting rules 
concerning the blocking of terminating access by a long-distance car- 
rier (applicable to Iowa intrastate traffic only, of course).  
 
"From the beginning, it was apparent that this was an undefined situ- 
ation as far as both the Board's rules and Teleconnect's tariffs were 
concerned.  When it came to  denial of  service, both  were only con- 
cerned with  a carrier's  relations with its customer, simply defined 
as 'he who pays the bill,' not with those between  a carrier  and any 
non-customer third  party.  Although Jim Schmickley was a Teleconnect 
customer, what Teleconnect had done was cut off access over its lines 
to the  number of someone who had no relationship with it whatsoever. 
As far as giving notice of its having 'disconnected' someone,  it was 
only required by the existing rules to give notice of a disconnection 
to its customers; and it didn't know who the number  belonged to any- 
way because  the information  was nonpublished and the local exchange 
carrier wouldn't tell it.  The real solution  would be  for the Board 
to fill  in this  gap by adopting new rules which would deal with the 
matter on an industry-wide basis." 
 
"However, the Board's rules  and  Teleconnect's  tariffs  weren't the 
only source of authority to support Jim's position that what the com- 
pany had done was wrong.  Virtually unchanged since 1873, the Code of
Iowa has  contained what  is now  Chapter 477.  Specifically, Section 
477.6 states that anyone employed in the business of doing so *shall* 
transmit telephone  and telegraph  messages, without  exception.  The 
argument was that the Chapter and Section set forth the policy of the 
State of Iowa and that the later-enacted Chapter 476 which sets forth 
the Utilities Board's power and the Board's rules enacted pursuant to 
it must be interpreted consistently with that policy, which is to say 
that the Board's rules permitting disconnection of service constitute 
exceptions to  that policy  and that  a company's  actions in denying 
service must clearly be within one of those exceptions or be illegal. 
 
"At the  initial 'pre-trial  conference,' the parties were ordered to 
come up with an agreed stipulation  of facts  and statement  of legal 
issues presented  in the complaint proceeding.  In the course of try- 
ing to come up with a stipulation of  facts, I  found Teleconnect had 
an 'interesting'  philosophy with  respect to 'participation' in toll 
fraud.  From the beginning, in its filings with the  Utilities Board, 
it had  appeared to  at least suggest that the bbs and sysop in ques- 
tion had some involvement with the theft of Teleconnect service.  The 
company kept  resisting the simple factual statement that a person or 
persons unknown had committed toll fraud by calling the bbs number in 
question by  saying   'but there's 'more to it than that' and was fi- 
nally told flat out that the bbs records  for the  period in question 
were available,  would be produced, and the company would have to ei- 
ther put up or shut up with respect to its  insinuating that  the bbs 
and its  sysop had  somehow been participating in the toll fraud.  It 
turned out that this 'participation' in the company's view was simply 
that the bbs provided the means for a fraudulent call to be completed 
even though the sysop had no way of knowing how  calls to  his system 
were being  made.   Anyone, not just a bbs sysop, was a 'participant' 
in toll fraud, according  to the company, simply by  answering a call
being fraudulently made, whether the person picking up  the phone had 
any idea that was how it was being made or not.  
  
"We finally got a stipulation; and Teleconnect promptly ignored it in
its prehearing brief,  prompting a motion to  strike that brief which
was  sustained by the  Administrative Law Judge  after a phone confe-
rence call hearing.
  
"The  agreed procedure  followed the  customary procedure  in utility
rate cases.   The  company would file prepared, written direct testi- 
mony and exhibits of its witness, the complainant would then file his 
direct testimony  and that of his witness, and the company would file 
its rebuttal testimony.  A hearing would be  held for  the purpose of 
cross-examining the  various witnesses,  briefs would be filed, and a 
proposed decision rendered by the ALJ.   The  company's testimony ex- 
tensively discussed the problem of toll fraud and why its actions had 
been justified, then it  filed a  motion in  limine in  an attempt to 
prevent *any* cross-examination of its witness about those aspects of 
its witness' testimony.  The response was both  to resist  the motion 
and, in  the alternative  if the motion were to be granted, to strike 
the witness' testimony and exhibits concerning the "taboo" subject.  
  
"In the course of a hearing on the pending motion in limine, the mat- 
ter of  what Jim  could hope  to get in the way of relief through the 
complaint proceeding was discussed.   Should  the ALJ  agree that any 
existing statute  or Board  rule had  been violated,  all he would be 
able to give in the way of relief would be an order  that this parti- 
cular company  not do it again; he couldn't fashion any sort of rules 
for the entire industry, nor could he fill in the gap in the existing 
rules by  making new  ones.  Any relief to be given by the ALJ in the 
complaint proceeding would be prospective in  nature and  only affect 
Teleconnect, but  the Board  could address the matter on an industry- 
wide basis and afford  even  better  prospective  relief  by adopting 
rules  that  everyone  would  have  to  follow in the future.  It was 
therefor agreed that both sides would petition the Utilities Board to 
adopt rules concerning blocking and the complaint proceeding would be 
stayed pending the Board's action on the petitions.  
  
"Both sides filed rulemaking petitions.  (That filed on behalf of Jim 
Schmickley follows the chronology.)  The Board ultimately denied both 
petitions.  Over a month after a motion to get  the show  on the road 
again was  filed and  a month  after a  resistance to that motion was 
filed, the Board began a rulemaking proceeding on  its own.   (Copies 
of the  Board's Notice  of Intended  Action and Order Commencing Rule 
Making Proceeding follow the  Schmickley petition.)   The  motion was 
therefor withdrawn.   The ALJ issued an order continuing the stay and 
proposing to dismiss the  complaint now  that the  Board had  begun a 
rulemaking on  the subject.   Dismissal  was resisted  on the grounds 
that no one could know in advance how the rulemaking would affect the 
complaint proceeding  -- what,  if any,  rules the board would adopt. 
As a result, the  stay was  simply continued  to see  what action the 
Board would take in the rulemaking proceeding.  
  
"Comments were  filed in the rulemaking proceeding; and the Board ul- 
timately adopted rules substantially the same  as the  proposed rules 
to govern  the blocking  of Iowa  intrastate terminating  access by a 
long-distance carrier, providing the  long-distance carrier  with the 
name and  address of the customer whose number was being blocked, and 
notice to that customer of the fact of the blocking and of the oppor- 
tunity for  a hearing before the Board.  I tried to conclude the com- 
plaint proceeding by filing a motion for summary judgment, asking the 
ALJ to  issue an  order to  the company to the effect that 'thou hast 
sinned, now go thou and sin no more,' but the ALJ wouldn't buy it and 
ordered that  the proceeding  be dismissed as moot after the adoption 
of rules by the Board."  
  
 
              Schmickley v. Teleconnect Chronology 
  
  Date  
11/09/88    Utilities Board Order Granting  Formal Complaint Pro-  
            ceedings and Assigning to Administrative Law Judge  
11/29/88    ALJ's Order Scheduling Prehearing Conference  
12/23/88    ALJ's Conference Report  
01/13/89    Complainant's Motion for Extension of Time  
01/20/89    Joint Statement of Legal Issues and Stipulation of  
            Facts  
01/27/89    ALJ's Order Establishing Briefing Schedule  
02/22/89    Company's Prehearing Brief  
03/17/89    Complainant's Prehearing Brief  
03/17/89    Complainant's Motion to Strike Company's Brief  
03/17/89    Consumer Advocate's Prehearing Brief  
04/06/89    ALJ's Order Granting Motion to Strike and Establishing  
            Procedural Schedule  
            Appearance by Phil Stoffregen for Company  
05/15/89    Company's Prepared Direct Testimony and Exhibits  
06/06/89    Company's Motion in Limine  
06/08/89    Complainant's  Resistance to Motion in Limine and  
            Motion to Strike (Company's) Testimony  
06/13/89    Company's Resistance to Motion to Strike Testimony  
            and Reply in Support of Motion in Limine  
06/15/89    Complainant's Motion for Extension of Time  
06/19/89    Complainant's Prepared Direct Testimony  
06/19/89    Prepared Direct Testimony and Exhibits of Complai-  
            nant's Witness  
06/27/89    Company's Motions Concerning Hearing Schedule  
07/06/89    Company's Prepared Rebuttal Testimony and Exhibits  
07/11/89    ALJ's Order Scheduling Hearing on Motions and Re-  
            scheduling Evidentiary Hearing  
07/13/89    Company's Brief in Support of Motion in Limine  
07/14/89    Complainant's Brief and Argument Against Motion in  
            Limine and in Support of Motion to Strike Testimony  
07/27/89    ALJ's Order Granting Stay  
08/04/89    Complainant's Petition for Rulemaking  
08/04/89    Company's Petition for Rulemaking  
08/07/89    Board's Letter acknowledging receipt of  
            Complainant's Petition for Rulemaking  
10/03/89    Board's Order Denying Petitions for Rulemaking  
10/18/89    Complainant's Motion to Reopen Record  
10/25/89    Company's Resistance to Motion to Reopen Record  
11/27/89    Board's Order Commencing Rulemaking, Docket RMU-89-30  
12/05/89    Complainant's Withdrawal of Motion to Reopen Record  
12/12/89    ALJ's Order Continuing Stay  
12/27/89    Complainant's Response to Order Continuing Stay,  
            Objecting to Dismissal, Motion to Reopen Record, and  
            Motion for Summary Judgment  
            Complainant's Comments filed in RMU-89-30  
01/10/90    Company's Resistance to Complainant's Motions  
01/12/90    Complainant's Additional Comments filed in RMU-89-30  
04/26/90    ALJ's Order Continuing Stay and Denying Motions to  
            Reopen Record and for Summary Judgment  
07/20/90    Board's Order Adopting Rules in RMU-89-30  
08/02/90    Counsel's Letter to Chairman Nagel, re: notice of  
            oral presentation on proposed rules  
08/03/90    Complainant's Motion for Summary Judgment and to Re-  
            open Record for Entry of Summary Judgment  
08/20/90    Reply letter from Chairman Nagel to Counsel  
09/11/90    ALJ's Proposed Decision and Order Dismissing  
            Complaint  
09/18/90    ALJ's Errata Order  
 


                              STATE OF IOWA 
 
                         DEPARTMENT OF COMMERCE 
 
                            UTILITIES DIVISON 
 
_________________________________________________________________________ 
                                    ) 
IN RE:                              ) 
                                    )   DOCKET NO. RMU-89-30 
BLOCKING TERMINATING ACCESS         ) 
____________________________________)____________________________________ 
 
                      ORDER COMMENCING RULE MAKING 
 
                       (Issued November 27, 1989) 
 
     Pursuant to the authority of IOWA CODE 476.1, 476.2, 476.8, and
 
17A.4 (1989), the Utilities Board proposes the amendments to IOWA ADMIN.
 
CODE 199-22.4 attached to an incorporated by reference in this order.
 
This rule would be known as IOWA ADMIN. CODE 199-22.5(13).  The reasons
 
for proposing this rule are set forth in the attached notice of intended
 
action.  
 
     IT IS THEREFORE ORDERED:  
 
     1.    A rule making proceeding under IOWA  CODE 17A.4 (1989),
 
identified as RMU-89-30, is commenced for the purpose of receiving comment 
 
upon the proposed rules attached to this order.  
 
     2.   The Executive Secretary of the Utilities  Board is directed to
 
submit for publication in the Iowa Administrative Bulletin a notice in the 
 
form attached to and incorporated by reference in this order.   
 
                                   UTILITIES BOARD 
 
                                   _/s/__Dennis_J._Nagel_____________ 
 
                                   _/s/__Paul_Franzenburg____________ 
ATTEST:  
________________________________   _/s/__Nancy_Shimanek_Boyd_________ 
Executive Secretary 
 
Dated at Des Moines, Iowa, this 27th day of November, 1989.  


                        UTILITIES DIVISION [199] 
 
                        NOTICE OF INTENDED ACTION 
 
  The Iowa State Utilities Board hereby gives notice that on November 27, 
 
1989, the Board issued an order in Docket No. RMU-89-30, In Re: Blocking 
 
Terminating Access, "Order Commencing Rule Making," pursuant to the 
 
authority of IOWA CODE sections 476.1, 476.2, 476.8, and 17A.4 (1989), to 
 
consider the adoption of a new rule, IOWA ADMIN. CODE 199-22.5(13) (1989). 
 
  This rule would address some of the problems surrounding fraudulent use 
 
of the telephone network by providing a manner in which telephone 
 
companies must deal with subscribers whose lines the company suspects may 
 
be subject to use for telephone fraud.  A recent complaint case before the 
 
Board has brought this matter to the Board's attention.  
 
  Under IOWA CODE sections 17A.4(1)"a" and "b" (1989), all interested 
 
persons may file written comments on the proposed rule no later than 
 
January 2, 1990, by filing an original and ten copies of the comments 
 
substantially complying with the form prescribed in IOWA ADMIN. CODE 199- 
 
2.2(2) (1989).  All written statements should clearly state the author's 
 
name and address and should make specific reference to this docket.  All 
 
communications should be directed to the Executive Secretary, Iowa State 
 
Utilities Board, Lucas State Office Building, Des Moines, Iowa 50319.  
 
                                    1 
 
 
_____________________________________________________________ 
 
  ITEM 1.  Add the following new rule, 199-22.5(13): 
 
  Blocking. 
 
  a.  No rate regulated or non-rate regulated local exchange utility or 
 
interexchange utility shall block terminating access to an individual 
 
number of a current residential or business subscriber, except as allowed 
 
in subrule 22.5(13).  
 
  b.  If a provider of long distance services desires, because of 
 
suspected toll fraud, to block the completion of calls to an individual 
 
access number or line number, that provider shall commence blocking only: 
 
      1.  Twenty-four hours after delivery to an overnight delivery 
 
service of notice of the blocking addressed to the named subscriber; or 
 
      2.  Seventy-two hours after delivery to a U.S. post office, for 
 
mailing by registered mail, of notice of the blocking addressed to the 
 
named subscriber.  
 
  Compliance with subrule 22.5(13)"b"(1) shall be shown by a receipt 
 
showing the time and date, and compliance with subrule 22.5(13)"b"(2) 
 
shall be shown by a receipt showing the date.  The long distance provider 
 
performing the blocking or directing the local exchange utility to perform 
 
the blocking shall be responsible for proper delivery of the notice of 
 
blocking.   
 
  c.  The notice of blocking shall:  
 
                                    2 
 
 
      1.  Inform the subscriber of the line to be blocked that it has the 
 
right to receive a complete copy of the long distance provider's records 
 
of the instances where the provider suspects that its facilities have been 
 
or are being used for purposes of toll fraud;  
 
      2.  State the name and address to which any written request for 
 
information may be mailed;  
 
      3.  State that the subscriber, after receiving information from the 
 
blocking utility, has the right to file a written complaint with the Iowa 
 
State Utilities Board regarding this blocking;  
 
      4.  State the address of the Iowa State Utilities Board; 
 
      5.  State that the suspected toll fraud may not have been committed 
 
by the subscriber and that the blocking implies no impropriety by the 
 
subscriber;  
 
  The long distance provider performing the blocking or requesting the 
 
blocking by a local exchange utility shall provide complete copies of all 
 
the requested materials to the line subscriber within 24 hours of receipt 
 
of the written request.  
 
  d.  All utilities providing regulated telecommunication services in Iowa 
 
shall designate individuals, who shall be available during all daytime 
 
working hours, to be responsible for either requesting or receiving the 
 
names and addresses of individuals whose line numbers are suspected of 
 
being used for toll fraud.  Names and addresses shall be released by one  
 
                                    3 


utility to another within 24 hours of receipt of a written request and 
 
only for the specific purpose of providing notice of the blocking to the 
 
subscriber.  Within 24 hours of receipt of the requested information, the 
 
requesting utility shall commence notification procedures under 
 
22.5(13)"b".  This requirement to provide data includes all non-listed and 
 
non-published numbers and customer address designations.  All utilities 
 
exchanging data under this subrule shall specifically agree that the 
 
information shall be used only for the limited purpose of providing notice 
 
of the blocking to the subscriber and that the information shall not be 
 
released to any third parties.  
 
  e.  Any utility desiring to implement blocking shall have tariffs on 
 
file indicating that its long distance service to a given number may from 
 
time to time be blocked by the utility because of suspected toll fraud.  
 
The tariff shall state that a recorded message will be announced on the 
 
identified line indicating that the line has been blocked.  
 
                              November 27, 1989  
 
 
 
                              _/s/__Dennis_J._Nagel______ 
                              Dennis J. Nagel 
                              Chairperson 
 
 
 
 
 
 
 
                                    4 
 
 
Following is the petition for rule making submitted by James 
Schmickley that was denied by the Utilities Board:  
 
================================================================ 
                         STATE OF IOWA  
                BEFORE THE IOWA UTILITIES BOARD  
________________________________________________________________  
                                ) 
IN RE: Rules Relating to        ) 
Denial of Service by Iowa       )  DOCKET NO. RMU-89-19 
Telephone Utility Companies     ) 
to Other Than Their Own         )  PETITION FOR RULE MAKING  
Customers.                      ) 
________________________________)________________________________ 
 
     COMES NOW James Schmickley, the complainant in Docket No. 
 
FCU-88-5 (C-88-61), by his undersigned counsel, pursuant to the 
 
Order Granting Stay issued by Administrative Law Judge Edmund 
 
Schlak, Jr., in that proceeding and for his petition states:  
 
                 Rules to Be Amended or Adopted 
 
     1.  Amend the board's rules at 199 Iowa Administrative Code 
 
Chapter 22 by:  
 
     a.  Renumbering section 22.15(1) as 22.15(1)"a"; renumbering 
 
section 22.15(2) as 22.15(1)"b"; renumbering section 22.15(3) as 
 
22.15(1)"c"; and adding as new 22.15(1) the words "Connections 
 
with local exchange services or facilities."  
 
     b.  Adding as new 22.15(2) the words "Standards of service to 
 
the public."  
 
     c.  Adding as new 22.15(2)"a" the words "An interexchange 
 
utility shall comply with the board's rules found at 199 IAC 22.4 
 
with respect to relations with its customers as such are defined 
 
at 199 IAC 22.1(3)."  
 
     d.  Adding as new 22.15(2)"b" the words "An interexchange 
 
utility shall not, on its own, without an order either of a court 
 
of competent jurisdiction or of a law enforcement agent or agency 
 
acting pursuant to such an order or to statutory authority, refuse 
 
to allow calls to be made through its facilities by its customers 
 
from any point within the State of Iowa to any other point within 
 
the State of Iowa."  
 
     e.  Adding as new 22.15(2)"c" the words "Every interexchange 
 
utility blocking access to a number pursuant to an order of a 
 
court or of a law enforcement agent or agency shall configure its 
 
equipment so that the call of anyone attempting to call any such 
 
number shall be intercepted by either an operator or a device 
 
which transmits a recorded announcement to the caller.  The caller 
 
shall be advised by such operator or recorded announcement that 
 
the call cannot be completed and shall be given a local or toll- 
 
free number to call for more information from the utility and the 
 
name of a company representative at such number with whom to 
 
speak.  Such company representative shall make such disclosure of 
 
the reasons the call could not be completed as may be made without 
 
impeding an active investigation or prosecution and shall advise 
 
the caller that a complaint may be made to the board if the caller 
 
is dissatisfied with the company's response, giving the address 
 
and telephone number of the board.  On receiving any such 
 
complaint, the board shall investigate and advise the complainant 
 
whether the company's action is in accordance with the board's 
 
rules and applicable law and proceed against the company if it 
 
finds a violation.   
 
     e.  Adding as new 22.15(2)"d" the words "Every interexchange 
 
utility shall file with the board, within thirty (30) days after 
 
adoption of these rules, a report showing the name of or number 
 
assigned to any and all entities not its customers to which it has 
 
denied access through its facilities on its own, contrary to 
 
22.15(2)"b", the reasons for denying access, the period during 
 
which access was denied, and the date on which such blocking 
 
ceased, unless the blocking is being continued in accordance with 
 
22.15(2)"b", in which case the utility shall report the quantity 
 
of affected telephone numbers and cite the authority under which 
 
it is acting without revealing the specific numbers affected by 
 
each order, or unless the utility has not engaged in such bloc- 
 
king, in which case the utility shall so state.  Any utility re- 
 
quired to make a report by this section may petition the board for 
 
an order that the contents of such report shall not be disclosed 
 
to the public, giving good and sufficient reasons therein why the 
 
request should be granted and citing authority in support of its 
 
argument.  
 
     f.  Adding as new 22.15(3) the words "Cooperation in toll 
 
fraud investigations."  
 
     g.  Adding as new section 22.15(3)"a" the words "Every in- 
 
terexchange and intraexchange telephone utility shall cooperate 
 
with every other interexchange and intraexchange telephone utility 
 
in the conduct of investigations into the use of any such 
 
utility's facilities (1) in a manner the purpose or effect of 
 
which is to avoid payment of lawful charges for such use or (2) in 
 
furtherance of any scheme the purpose or effect of which is to 
 
avoid payment of lawful charges for such use."  
 
     h.  Adding as new section 22.15(3)"b" the words "Any inter- 
 
exchange or intraexchange telephone utility which the board finds 
 
has refused to cooperate without good cause in an investigation 
 
described in 22.15(3)"a" shall be in willful violation of board 
 
rules."  
 
                       Supporting Argument 
 
     2.a.  This rulemaking proposal is a direct result of the dis- 
 
covery that the Teleconnect Company of Cedar Rapids, Iowa, 
 
blocked, and maintains that it has the power to block at its sole 
 
discretion, its customers within the State of Iowa with whom it 
 
had no complaint from using its facilities to place interexchange 
 
calls to a number assigned to someone within the State of Iowa who 
 
was not its customer simply because some third party may have com- 
 
mitted toll fraud by calling the number using a Teleconnect access 
 
code which was stolen or discovered simply by trying various num- 
 
bers until finding one that worked.  The blocking was done en- 
 
tirely by the company on its own, not in compliance with any court 
 
order or in cooperation with any law enforcement agent or agency, 
 
to the best of the petitioner's knowledge.  The company has pro- 
 
duced no evidence that the person responsible for the number to 
 
which access was denied himself had any active involvement with 
 
the fraudulent use of the company's facilities.  
 
     b.  The parties in Docket No. FCU-88-5 have recognized that 
 
Teleconnect is not the only interexchange carrier operating within 
 
Iowa; it is simply the only one discovered so far to be doing what 
 
it was doing.  It may or may not be the only interexchange carrier 
 
which has been or is denying access in this manner; and no order 
 
entered in Docket No. FCU-88-5 can deal with the matter on a 
 
statewide basis by affecting any company other than Teleconnect.  
 
There is no effective way to find out how widespread the use of 
 
this procedure is or has been other than by requiring every in- 
 
terexchange carrier to report such actions to the Board; and there 
 
appears to be no way to deal with the very real, practical 
 
problems encountered by Teleconnect in conducting a toll fraud 
 
investigation other than by the Board's requiring cooperation 
 
between the carriers in the conduct of such investigations.  
 
     c.  The situation prompting this rulemaking proposal is a 
 
direct result of recent changes in the provision of interexchange 
 
telephone service.  While the local exchange companies, particu- 
 
larly the Bell Operating Companies, and the American Telephone and 
 
Telegraph Company formed an integrated, exclusive telephone 
 
network, the customer of one was the customer of both; and the 
 
actions complained of with respect to Teleconnect simply could not 
 
have occurred.  A fraud perpetrated upon the one was perpetrated 
 
upon them all and information could and would be exchanged to 
 
identify the culprit.  
 
     d.  The board's rules have simply failed to keep pace with 
 
the changes that have taken place in the provision of interex- 
 
change service.  The rules contained in 190 IAC Chapter 22 only 
 
deal with relations between a utility and its customer, defined as 
 
whoever pays the bill, as do the utilities' tariffs.  Teleconnect 
 
gave no notice of its actions to anyone because it had no one to 
 
notify, it used an intercept which wrongly advised its customers 
 
who attempted to call the blocked number that theirs were local 
 
calls, and it used the fact that no one complained to further 
 
defend its actions.  The proposed rules are designed to fill this 
 
gap.  
 
     e.  The policy of the State has been expressed since the 
 
1800's (Code of 1873, Sec. 1328) in what is now Code Section 
 
477.6, which provides, in pertinent part, that any person employed 
 
in transmitting messages by telegraph or telephone who willfully 
 
refuses to do so shall be guilty of a simple misdemeanor.  The 
 
Board is not charged with enforcement of Chapter 477, but Chapter 
 
476 and the Board's Rules should be interpreted in pari materia 
 
with Section 477.6.  The proposed rules are designed to further 
 
the policy stated in Code Section 477.6 and should be adopted 
 
notwithstanding any decision by the Board to de-regulate Iowa 
 
intrastate toll telephone service because it has become com- 
 
petitive.  
 
     f.  The proposed rules are in no way to be interpreted as a 
 
defense of the perpetrators of telephone toll fraud.  Notwith- 
 
standing the separation of interexchange and intraexchange car- 
 
riers in recent years, the perpetrators of telephone toll fraud 
 
commit an offense against all paying telephone customers.  It is 
 
in the public interest that perpetrators of telephone toll fraud 
 
be identified and apprehended.  The proposed rules will not, in 
 
any way, impede a toll fraud investigation by law enforcement 
 
authorities or by the companies themselves.  They may, in fact, 
 
encourage the companies to initiate and cooperate in such inves- 
 
tigations by denying them the ability to simply foist the problem 
 
off onto another carrier.  When its denial of access was chal- 
 
lenged, Teleconnect, for example, advised its customers they had 
 
the option to make the call via AT&T.  
 
     g.  In defense of its actions, Teleconnect has stated that 
 
denying access was the only thing it could do; that it was unable 
 
to ascertain the identity of the entity to which the number being 
 
blocked was assigned, that entity not being itself one of the com- 
 
pany's customers, because the local exchange carrier of which the 
 
entity was a customer could not or would not divulge the informa- 
 
tion.  Without that information, it could not contact the entity 
 
to enlist its aid in ascertaining the identity of the toll fraud 
 
perpetrator.  Pertinent provisions of the proposed rules are 
 
designed to mandate cooperation in furtherance of the common goal, 
 
for the benefit of all Iowa ratepayers.  
 
     WHEREFORE, James Schmickley, prays that the Board institute a 
 
rulemaking proceeding to amend its rules as hereinbefore set 
 
forth.  
 
                                   Respectfully submitted,  
 
  
 
                                   _____________________________ 
                                   Bruce L. Wilson 
                                   Attorney for Petitioner 
                                   677 - 61st Street  
                                   Des Moines, Iowa 50312 
                                   (515) 277-4904  
 

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>From: riddle@hoss.unl.edu (Michael H. Riddle)
Subject: Re: Blocking of Long Distance Calls - Part II
Message-ID: <1990Nov08.163001.16424@hoss.unl.edu>
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Date: Thu, 08 Nov 90 16:30:01 GMT

In Message-ID: <14299@accuvax.nwu.edu>
Date: 3 Nov 90 23:37:00 GMT regarding 
TELECOM Digest   Sat, 3 Nov 90 17:37:00 CST  Blocking LD Calls - Part II
 
the Moderator writes:
 
> [Moderator's Note: My thanks to Mr. Winslade for sending this along.
> Now we need an update: what has happened over the past two years? We
> know of course that Telecom*USA is now part of MCI. 
 

Bruce Wilson, Esq., a BBS-literate attorney who was involved in
the Teleconnect blocking case in Iowa, was gratious enough to
provide the following update for us:

"The [special edition] appears to be primarily the text files
which Jim Schmickley wrote and uploaded as BLOCKER.ARC and similar
names, with the last dated reference being December 22, 1988.  I
don't know what, if anything, happened after that with respect to
the FCC complaint.  As far as that filed with the Iowa Utilities
Board, [a] chronological listing [follows at the end] of what
took place until the complaint was finally dismissed in September,
1990.  The reason for that dismissal was that the Board had
effectively given all the prospective relief Jim could ask for and
expect to get from the complaint proceeding by adopting rules
concerning the blocking of terminating access by a long-distance
carrier (applicable to Iowa intrastate traffic only, of course).

"In the course of trying to come up with a stipulation of facts, I
found Teleconnect had an "interesting" philosophy with respect to
"participation" in toll fraud.  From the beginning, in its filings
with the Utilities Board, it had appeared to at least suggest that
the bbs and sysop in question had some involvement with the theft
of Teleconnect service.  The company kept resisting the simple
factual statement that a person or persons unknown had committed
toll fraud by calling the bbs number in question and was finally
told the bbs records for the period in question were available,
would be produced, and the company would have to either put up or
shut up with respect to its insinuating that the bbs and its sysop
had somehow been participating in the toll fraud.  It turned out
that this "participation" in the company's view was simply that the
bbs provided the means for a fraudulent call to be terminated, even
though the sysop had no way of knowing how calls to his system were
being made.  Anyone, not just a bbs sysop, was a "participant" in
toll fraud, according to the company, simply by answering a call
being fraudulently made, whether the person picking up the phone
knew that was how it was being made or not.

"We finally got a stipulation; and Teleconnect promptly ignored it
in its prehearing brief, prompting a motion to strike that brief
which was sustained by the Administrative Law Judge after a phone
conference call hearing.

"The agreed procedure followed the customary procedure in utility
rate cases.  The company would file prepared, written direct
testimony and exhibits of its witness, the complainant would then
file his direct testimony and that of his witness, and the company
would file its rebuttal testimony.  A hearing would be held for the
purpose of cross-examining the various witnesses, briefs would be
filed, and a proposed decision rendered by the ALJ.  The company's
testimony extensively discussed the problem of toll fraud and why
its actions had been justified, then it filed a motion in limine in
an attempt to prevent any cross-examination of its witness about
those aspects of its witness' testimony.  The response was to
resist the motion and, in the alternative if the motion were to be
granted, to strike the witness' testimony and exhibits concerning
the "taboo" subject.

"In the course of a hearing on the pending motion in limine, the
matter of what Jim could hope to get in the way of relief through
the complaint proceeding was discussed.  What Teleconnect had been
caught doing simply wasn't covered in the Board's rules or company
tariffs.  Should the ALJ agree that any existing statute or Board
rule had been violated, all he would be able to give in the way of
relief would be an order that this particular company not do it
again; he couldn't fashion any sort of rules for the entire
industry, nor could he fill in the gap in the existing rules by
making new ones.  Any relief to be given by the ALJ in the
complaint proceeding would be prospective in nature and only affect
Teleconnect, but the Board could address the matter on an industry-
wide basis and afford even better prospective relief by adopting
rules that everyone would have to follow in the future.  It was
therefor agreed that both sides would petition the Utilities Board
to adopt rules concerning blocking and the complaint proceeding
would be stayed pending the Board's action on the petitions.

"Both sides filed rulemaking petitions; and the Board ultimately
denied both petitions.  Over a month after a motion to get the show
on the road again was filed and a month after a resistance to that
motion was filed, the Board began the rulemaking proceeding on its
own motion, so the motion was withdrawn.  The ALJ issued an order
continuing the stay and proposing to dismiss the complaint now that
the Board had begun a rulemaking on the subject.  This was resisted
on the grounds that no one could know in advance how the rulemaking
would affect the complaint proceeding -- what, if any, rules the
board would adopt.  As a result, the stay was simply continued to
see what action the Board would take in the rulemaking proceeding.

"Comments were filed in the rulemaking proceeding; and the Board
ultimately adopted rules to govern the blocking of Iowa intrastate
terminating access by a long-distance carrier, providing the long-
distance carrier with the name and address of the customer whose
number was being blocked, and notice to that customer of the fact
of the blocking and of the opportunity for a hearing before the
Board.  I tried to conclude the complaint proceeding by filing a
motion for summary judgment, asking the ALJ to issue an order to
the company to the effect that "thou hast sinned, now go thou and
sin no more," but the ALJ wouldn't buy it and effectively ordered
that the proceeding be dismissed as moot with the adoption of rules
by the Board."

                   Schmickley v. Teleconnect

  Date
11/09/88    Utilities Board Order Granting  Formal Complaint Pro-
            ceedings and Assigning to Administrative Law Judge
11/29/88    ALJ's Order Scheduling Prehearing Conference
12/23/88    ALJ's Conference Report
01/13/89    Complainant's Motion for Extension of Time
01/20/89    Joint Statement of Legal Issues and Stipulation of
            Facts
01/27/89    ALJ's Order Establishing Briefing Schedule
02/22/89    Company's Prehearing Brief
03/17/89    Complainant's Prehearing Brief
03/17/89    Complainant's Motion to Strike Company's Brief
03/17/89    Consumer Advocate's Prehearing Brief
04/06/89    ALJ's Order Granting Motion to Strike and Establishing
            Procedural Schedule
            Appearance by Phil Stoffregen for Company
05/15/89    Company's Prepared Direct Testimony and Exhibits
06/06/89    Company's Motion in Limine
06/08/89    Complainant's  Resistance to Motion in Limine and
            Motion to Strike (Company's) Testimony
06/13/89    Company's Resistance to Motion to Strike Testimony
            and Reply in Support of Motion in Limine
06/15/89    Complainant's Motion for Extension of Time
06/19/89    Complainant's Prepared Direct Testimony
06/19/89    Prepared Direct Testimony and Exhibits of Complai-
            nant's Witness
06/27/89    Company's Motions Concerning Hearing Schedule
07/06/89    Company's Prepared Rebuttal Testimony and Exhibits
07/11/89    ALJ's Order Scheduling Hearing on Motions and Re-
            scheduling Evidentiary Hearing
07/13/89    Company's Brief in Support of Motion in Limine
07/14/89    Complainant's Brief and Argument Against Motion in
            Limine and in Support of Motion to Strike Testimony
07/27/89    ALJ's Order Granting Stay
08/04/89    Complainant's Petition for Rulemaking
08/04/89    Company's Petition for Rulemaking
08/07/89    Board's Letter acknowledging receipt of
            Complainant's Petition for Rulemaking
10/03/89    Board's Order Denying Petitions for Rulemaking
10/18/89    Complainant's Motion to Reopen Record
10/25/89    Company's Resistance to Motion to Reopen Record
11/27/89    Board's Order Commencing Rulemaking, Docket RMU-89-30
12/05/89    Complainant's Withdrawal of Motion to Reopen Record
12/12/89    ALJ's Order Continuing Stay
12/27/89    Complainant's Response to Order Continuing Stay,
            Objecting to Dismissal, Motion to Reopen Record, and
            Motion for Summary Judgment
            Complainant's Comments filed in RMU-89-30
01/10/90    Company's Resistance to Complainant's Motions
01/12/90    Complainant's Additional Comments filed in RMU-89-30
04/26/90    ALJ's Order Continuing Stay and Denying Motions to
            Reopen Record and for Summary Judgment
07/20/90    Board's Order Adopting Rules in RMU-89-30
08/02/90    Counsel's Letter to Chairman Nagel, re: notice of
            oral presentation on proposed rules
08/03/90    Complainant's Motion for Summary Judgment and to Re-
            open Record for Entry of Summary Judgment
08/20/90    Reply letter from Chairman Nagel to Counsel
09/11/90    ALJ's Proposed Decision and Order Dismissing
            Complaint
09/18/90    ALJ's Errata Order


My thanks to Bruce for his update.
--
riddle@hoss.unl.edu                  |   University of Nebraska 
riddle@crchpux.unl.edu               |   College of Law
mike.riddle@f27.n285.z1.fidonet.org  |   Lincoln, Nebraska, USA



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