S T A T E   O F   N E W   Y O R K
 ________________________________________________________________________
 
                                   6912
 
                        2019-2020 Regular Sessions
 
                           I N  A S S E M B L Y
 
                              March 27, 2019
                                ___________
 
 Introduced  by  M. of A. NIOU -- read once and referred to the Committee
   on Consumer Affairs and Protection
 
 AN ACT to amend the general  business  law,  in  relation  to  requiring
   authorization  by  the  customer, and verification by the telecommuni-
   cations providers, of the validity of third-party charges for products
   and services billed to a customer  on  bills  issued  by  telecommuni-
   cations providers to their customers
 
   THE  PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM-
 BLY, DO ENACT AS FOLLOWS:
 
   Section 1. Legislative findings and  purpose.  The  legislature  finds
 that some third-party companies are placing unauthorized service charges
 on telecommunications customers' monthly bills. The practice is commonly
 called  "cramming".  Cramming  is  a  form of fraud in which charges are
 added to a bill by a third  party  without  the  customer's  consent  or
 disclosure.  The  legislature  further  finds  that many New Yorkers are
 switching to phone service provided by cable TV or  Internet  companies.
 These companies can also offer third-party billing that may inadvertent-
 ly  result  in fraud through no fault of their own actions. Accordingly,
 the purpose of this act is to help reduce the level of cramming  and  to
 provide remedies that offer greater protection to the telecommunications
 customers of all service providers.
   §  2. The general business law is amended by adding a new section 399-
 zzzzz to read as follows:
   § 399-ZZZZZ. AUTHORIZATION AND VERIFICATION FOR  PRODUCT  AND  SERVICE
 CHARGES  TO BE BILLED ON A CONSUMER'S BILL. 1. DEFINITIONS. FOR PURPOSES
 OF THIS SECTION:
   (A) "BILLING AGENT" MEANS ANY ENTITY THAT SUBMITS CHARGES TO THE BILL-
 ING CARRIER ON BEHALF OF ITSELF OR ANY SERVICE PROVIDER.
   (B) "BILLING CARRIER" MEANS ANY TELEPHONE CORPORATION, AS  DEFINED  IN
 SUBDIVISION  SEVENTEEN  OF  SECTION  TWO  OF THE PUBLIC SERVICE LAW, AND
 EVERY CABLE TELEVISION COMPANY, AS DEFINED IN SUBDIVISION ONE OF SECTION
 
  EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                       [ ] is old law to be omitted.
              

                                                            LBD08622-01-9

 A. 6912                             2
 
 TWO HUNDRED TWELVE OF THE PUBLIC SERVICE LAW THAT PROVIDES TELEPHONE  OR
 LIKE  SERVICE  TO CUSTOMERS IN THE STATE OF NEW YORK, THAT ISSUES A BILL
 DIRECTLY TO A CUSTOMER FOR ANY PRODUCT OR  SERVICE  NOT  PROVIDED  BY  A
 TELECOMMUNICATIONS  CARRIER,  ITS AFFILIATE OR THIRD PARTY PROVIDER WITH
 WHOM A TELEPHONE CORPORATION OR CABLE TELEVISION COMPANY OR THEIR AFFIL-
 IATES JOINTLY MARKET SERVICES.
   (C) "CRAMMING" MEANS A FORM OF FRAUD IN WHICH CHARGES ARE ADDED  TO  A
 BILL  BY A THIRD PARTY WITHOUT THE SUBSCRIBER'S AUTHORIZATION OR DISCLO-
 SURE.
   (D) "SERVICE PROVIDER" MEANS ANY  ENTITY  THAT  OFFERS  A  PRODUCT  OR
 SERVICE  TO  A  CONSUMER  AND  THAT DIRECTLY OR INDIRECTLY CHARGES TO OR
 COLLECTS FROM A CONSUMER'S BILL  RECEIVED  FROM  A  BILLING  CARRIER  AN
 AMOUNT  FOR  THE  PRODUCT  OR  SERVICE.  FOR PURPOSES OF THIS SECTION, A
 SERVICE PROVIDER SHALL NOT INCLUDE AN AFFILIATE OF A BILLING CARRIER  OR
 A  THIRD  PARTY  PROVIDER  WITH WHOM A BILLING CARRIER OR ITS AFFILIATES
 JOINTLY MARKET SERVICES.
   2. REQUIREMENTS FOR SUBMITTING CHARGES.  (A)  A  SERVICE  PROVIDER  OR
 BILLING  AGENT  MAY SUBMIT CHARGES FOR A PRODUCT OR SERVICE TO BE BILLED
 ON A CONSUMER'S BILL ONLY IF:
   (1) THE SERVICE PROVIDER OFFERING THE PRODUCT OR SERVICE  HAS  CLEARLY
 AND  CONSPICUOUSLY  DISCLOSED  ALL  MATERIAL TERMS AND CONDITIONS OF THE
 PRODUCT OR SERVICE BEING OFFERED, INCLUDING, BUT  NOT  LIMITED  TO,  ALL
 CHARGES;  AND THE FACT THAT THE CHARGES FOR THE PRODUCT OR SERVICE SHALL
 APPEAR ON THE CONSUMER'S BILL;
   (2) AFTER THE CLEAR AND CONSPICUOUS DISCLOSURE OF ALL  MATERIAL  TERMS
 AND  CONDITIONS BY THE SERVICE PROVIDER AS DESCRIBED IN SUBPARAGRAPH ONE
 OF THIS PARAGRAPH, THE CONSUMER HAS EXPRESSLY CONSENTED  TO  OBTAIN  THE
 PRODUCT OR SERVICE OFFERED AND TO HAVE THE CHARGES APPEAR ON THE CONSUM-
 ER'S  BILL  AND THE CONSENT HAS BEEN VERIFIED BY THE SERVICE PROVIDER AS
 PROVIDED IN PARAGRAPH (B) OF THIS SUBDIVISION;
   (3) THE SERVICE PROVIDER OFFERING THE PRODUCT OR SERVICE OR ANY  BILL-
 ING  AGENT  FOR  THE  SERVICE  PROVIDER HAS PROVIDED THE CONSUMER WITH A
 TOLL-FREE TELEPHONE NUMBER THE CONSUMER MAY CALL AND AN ADDRESS TO WHICH
 THE CONSUMER MAY WRITE TO RESOLVE ANY  BILLING  DISPUTE  AND  TO  ANSWER
 QUESTIONS; AND
   (4)  THE SERVICE PROVIDER OFFERING THE PRODUCT OR SERVICE OR THE BILL-
 ING AGENT HAS TAKEN EFFECTIVE STEPS TO DETERMINE THAT THE  CONSUMER  WHO
 PURPORTEDLY  CONSENTED  TO  OBTAIN  THE  PRODUCT  OR  SERVICE OFFERED IS
 AUTHORIZED TO INCUR CHARGES FOR THE TELEPHONE NUMBER TO BE BILLED.
   (B) THE CONSUMER CONSENT REQUIRED BY PARAGRAPH (A) OF THIS SUBDIVISION
 MUST BE VERIFIED BY THE SERVICE PROVIDER OFFERING THE PRODUCT OR SERVICE
 BEFORE ANY CHARGES ARE SUBMITTED FOR BILLING ON  A  CONSUMER'S  BILL.  A
 RECORD  OF  THE  CONSUMER CONSENT AND VERIFICATION MUST BE MAINTAINED BY
 THE SERVICE PROVIDER OFFERING THE PRODUCT OR SERVICE FOR A PERIOD OF  AT
 LEAST  TWENTY-FOUR MONTHS IMMEDIATELY AFTER THE CONSENT AND VERIFICATION
 HAVE BEEN OBTAINED. THE METHOD OF OBTAINING CONSUMER CONSENT AND VERIFI-
 CATION SHALL INCLUDE ONE OR MORE OF THE FOLLOWING:
   (1) A WRITING, SIGNED AND DATED BY THE CONSUMER  TO  BE  BILLED,  THAT
 CLEARLY AND CONSPICUOUSLY DISCLOSES THE MATERIAL TERMS AND CONDITIONS OF
 THE PRODUCT OR SERVICE BEING OFFERED IN ACCORDANCE WITH PARAGRAPH (A) OF
 THIS  SUBDIVISION  AND  WHICH  CLEARLY AND CONSPICUOUSLY STATES THAT THE
 CONSUMER  EXPRESSLY  CONSENTS  TO  BE  BILLED  IN  ACCORDANCE  WITH  THE
 PROVISIONS OF THIS SUBDIVISION AS FOLLOWS:
   (A)  IF  THE  WRITING IS IN ELECTRONIC FORM, THEN IT SHALL CONTAIN THE
 CONSUMER DISCLOSURES REQUIRED BY SECTION 101(C) OF THE FEDERAL ELECTRON-
 IC SIGNATURES IN GLOBAL AND NATIONAL COMMERCE ACT; AND

 A. 6912                             3
 
   (B) THE WRITING SHALL BE A SEPARATE DOCUMENT OR EASILY SEPARABLE DOCU-
 MENT OR LOCATED ON A SEPARATE SCREEN  OR  WEBPAGE  CONTAINING  ONLY  THE
 DISCLOSURES AND CONSENT DESCRIBED IN THIS SUBDIVISION;
   (2) THIRD-PARTY VERIFICATION BY AN INDEPENDENT THIRD PARTY THAT:
   (A)  CLEARLY  AND CONSPICUOUSLY DISCLOSES TO THE CONSUMER TO BE BILLED
 ALL OF THE INFORMATION REQUIRED BY PARAGRAPH (A) OF THIS SUBDIVISION;
   (B) OPERATES FROM A FACILITY PHYSICALLY  SEPARATE  FROM  THAT  OF  THE
 SERVICE PROVIDER OFFERING THE PRODUCT OR SERVICE;
   (C)  IS  NOT  DIRECTLY OR INDIRECTLY MANAGED, CONTROLLED, DIRECTED, OR
 OWNED WHOLLY OR IN PART BY THE SERVICE PROVIDER OFFERING THE PRODUCT  OR
 SERVICE;
   (D)  DOES NOT DERIVE COMMISSIONS OR COMPENSATION BASED UPON THE NUMBER
 OF SALES CONFIRMED;
   (E) TAPE RECORDS THE ENTIRE VERIFICATION PROCESS, WITH  PRIOR  CONSENT
 OF THE CONSUMER TO BE BILLED; AND
   (F) OBTAINS CONFIRMATION FROM THE CONSUMER TO BE BILLED THAT HE OR SHE
 AUTHORIZED THE PURCHASE OF THE OFFERED GOOD OR SERVICE.
   ALL VERIFICATIONS MUST BE CONDUCTED IN THE SAME LANGUAGE THAT WAS USED
 IN THE UNDERLYING SALES TRANSACTION.
   (C) UNLESS VERIFICATION IS REQUIRED BY FEDERAL LAW OR RULES IMPLEMENT-
 ING  FEDERAL  LAW,  THE  PROVISIONS OF PARAGRAPH (B) OF THIS SUBDIVISION
 SHALL NOT APPLY TO CUSTOMER-INITIATED TRANSACTIONS WITH  A  CERTIFICATED
 TELECOMMUNICATIONS CARRIER FOR WHICH THE SERVICE PROVIDER HAS THE APPRO-
 PRIATE DOCUMENTATION.
   (D)  THE  PROVISIONS  OF  THIS  SECTION  SHALL NOT APPLY TO COMMERCIAL
 MOBILE RADIO SERVICES, OR  MESSAGE  TELECOMMUNICATIONS  SERVICE  CHARGES
 THAT  THE END-USER CUSTOMER INITIATES BY DIALING 1+, 0+, 0-, 1010XXX, OR
 COLLECT CALLS AND CHARGES FOR VIDEO SERVICES IF THE SERVICE PROVIDER HAS
 THE NECESSARY RECORDS TO ESTABLISH THE BILLING FOR THE CALL OR SERVICE.
   3. RECORDS OF DISPUTED CHARGES. (A) EVERY SERVICE PROVIDER OR  BILLING
 AGENT  SHALL  MAINTAIN RECORDS OF EVERY DISPUTED CHARGE FOR A PRODUCT OR
 SERVICE PLACED ON A CONSUMER'S BILL.
   (B) THE RECORD REQUIRED UNDER THIS SUBDIVISION SHALL CONTAIN FOR EVERY
 DISPUTED CHARGE ALL OF THE FOLLOWING:
   (1) ANY AFFECTED TELEPHONE NUMBERS AND, IF AVAILABLE, ADDRESSES;
   (2) THE DATE THE  CONSUMER  REQUESTED  THAT  THE  DISPUTED  CHARGE  BE
 REMOVED FROM THE CONSUMER'S BILL;
   (3) THE DATE THE DISPUTED CHARGE WAS REMOVED FROM THE CONSUMER'S BILL;
 AND
   (4)  THE DATE ACTION WAS TAKEN TO REFUND OR CREDIT TO THE CONSUMER ANY
 MONEY THAT THE CONSUMER PAID FOR THE DISPUTED CHARGES.
   (C) THE RECORD REQUIRED BY THIS SUBDIVISION SHALL BE MAINTAINED FOR AT
 LEAST TWENTY-FOUR MONTHS.
   4. COMPLIANCE.  BILLING AGENTS SHALL TAKE REASONABLE STEPS DESIGNED TO
 ENSURE THAT SERVICE PROVIDERS ON WHOSE BEHALF THEY SUBMIT CHARGES  TO  A
 BILLING CARRIER COMPLY WITH THE REQUIREMENTS OF THIS SECTION.
   5.  VIOLATION.  ANY SERVICE PROVIDER OR BILLING AGENT WHO VIOLATES THE
 PROVISIONS OF THIS SECTION COMMITS AN UNLAWFUL PRACTICE.
   (A) IF A CUSTOMER DISPUTES A CHARGE FROM A SERVICE PROVIDER OR BILLING
 AGENT AND HAS IT REMOVED FROM THEIR BILL, NEITHER THE  BILLING  CARRIER,
 SERVICE  PROVIDER,  OR  BILLING  AGENT  CAN PUT THE SAME CHARGE FROM THE
 SERVICE PROVIDER ON ANY FUTURE BILLS UNLESS THE CUSTOMER HAS  EXPLICITLY
 GRANTED APPROVAL TO DO SO.
   (B)  IF  A  CUSTOMER CONTACTS THE SERVICE PROVIDER DIRECTLY INSTEAD OF
 CALLING THE BILLING CARRIER REGARDING AN UNAUTHORIZED  CHARGE  ON  THEIR
 TELEPHONE  BILL,  THE  SERVICE  PROVIDER  MUST AGREE TO PROVIDE A CREDIT

 A. 6912                             4
 
 ADJUSTMENT TO THE BILL. ANY FURTHER COLLECTION ATTEMPTS ON THE  PART  OF
 THE SERVICE PROVIDER SHOULD NOT INCLUDE THE BILL.
   (C)  ANY  UNAUTHORIZED SERVICE CHARGES ON TELECOMMUNICATIONS CUSTOMERS
 WILL BE DEEMED VOID AND UNENFORCEABLE. SERVICE PROVIDERS FOUND  TO  HAVE
 SUBMITTED  UNAUTHORIZED  SERVICE  CHARGES  CANNOT  PURSUE  SAID  CHARGES
 THROUGH COLLECTION AGENCIES.
   (D) EACH BILLING CARRIER AND BILLING AGENT SHALL  HAVE  IN  PLACE  AND
 COMPLY WITH A PROTOCOL FOR IDENTIFYING UNAUTHORIZED CHARGES AND SUSPEND-
 ING  OR  TERMINATING  BILLING  SERVICES  TO ANY BILLING AGENT OR SERVICE
 PROVIDER THAT HAS SUBMITTED UNAUTHORIZED CHARGES.
   (E) IF A CUSTOMER CONTACTS A BILLING CARRIER TO DISPUTE A BILLED  ITEM
 FROM  A  BILLING  AGENT  OR  SERVICE  PROVIDER, THE BILLING CARRIER MUST
 PROMPTLY ADDRESS THE DISPUTE BEFORE REFERRING THE CUSTOMER TO THE  BILL-
 ING AGENT OR SERVICE PROVIDER WHEN THE CUSTOMER INDICATES THE PRODUCT OR
 SERVICE WAS NOT AUTHORIZED. THIS INCLUDES, BUT IS NOT LIMITED TO, REMOV-
 ING  THE  UNAUTHORIZED  CHARGES  FROM THE CUSTOMER'S BILL, ENSURING THAT
 UNAUTHORIZED CHARGES FROM THE SAME SERVICE  PROVIDER  OR  BILLING  AGENT
 WILL  NOT  CONTINUE  TO  APPEAR ON THE CUSTOMER'S BILL, AND OFFERING THE
 CUSTOMER THE OPTION TO BAR ALL THIRD-PARTY BILLING ON THEIR BILL.
   (F) ANNUALLY, BILLING CARRIERS  SHALL  PROVIDE  INFORMATION  TO  THEIR
 CUSTOMERS  REGARDING  A COURSE OF ACTION TO DISPUTE UNAUTHORIZED CHARGES
 FROM SERVICE PROVIDERS. THIS SHALL INCLUDE, BUT IS  NOT  LIMITED  TO,  A
 DEFINITION  OF  CRAMMING, HOW TO DISPUTE AN UNAUTHORIZED CHARGE, AND HOW
 TO FILE A COMPLAINT WITH THE ATTORNEY GENERAL'S OFFICE.
   (G) THIRD-PARTY CHARGES SHALL BE SEPARATED FROM DIRECT  CHARGES  IN  A
 CLEAR MANNER.
   (H)  BILLING  CARRIERS  CANNOT DISCONNECT SERVICES OVER THE FAILURE TO
 PAY A DISPUTED THIRD PARTY CHARGE.
   (I) THE ATTORNEY GENERAL'S OFFICE SHALL HAVE THE AUTHORITY TO INVESTI-
 GATE COMPLAINTS OF CRAMMING.
   (J) THE ATTORNEY GENERAL'S OFFICE SHALL HAVE THE AUTHORITY  TO  PURSUE
 CIVIL  ACTION AGAINST SERVICE PROVIDERS AND BILLING AGENTS FOUND TO HAVE
 BEEN ENGAGING IN CRAMMING.
   (K) THE ATTORNEY GENERAL'S OFFICE SHALL HAVE THE AUTHORITY  TO  BLACK-
 LIST  ANY  SERVICE PROVIDER OR BILLING AGENT WHO HAS BEEN FOUND TO BE IN
 VIOLATION OF THIS SECTION OR  OTHERWISE  PARTICIPATING  IN  UNSCRUPULOUS
 PRACTICES FROM CONTRACTING WITH ANY BILLING CARRIER IN NEW YORK STATE.
   § 3. This act shall take effect on the one hundred twentieth day after
 it shall have become a law.  Effective immediately, the addition, amend-
 ment and/or repeal of any rule or regulation necessary for the implemen-
 tation  of this act on its effective date are authorized and directed to
 be made and completed on or before such effective date.