Strait-Telecom Co (海峽電信) has been listed by Chunghwa Telecom as a high-risk corporate customer and the two should terminate service contracts if necessary, the National Communications Commission said yesterday.
The mobile virtual network operator (MVNO) on Wednesday was fined NT$300,000 (US$9,604) by the regulator for failing to thoroughly authenticate the identities of service subscribers and consequently allowing scammers to use its mobile phone numbers to commit crimes.
As an MVNO, Strait-Telecom does not own a mobile spectrum license, but uses the Chunghwa Telecom network to offer mobile services under its brand name.
Photo: Liao Chen-huei, Taipei Times
Chunghwa Telecom’s contract with the MVNO stipulates that it allocate 300,000 mobile telephone numbers for Strait-Telecom to use. Of the 120,000 that have been transferred to Strait-Telecom, nearly 1,000 were used by scammers.
The commission launched an investigation into Strait-Telecom’s operations after receiving a tip-off from the Taoyuan District Prosecutors’ Office on June 1.
Local news media criticized the commission for handing a relatively lenient fine to Strait-Telecom, as Taiwan Star Telecom Co on Wednesday was fined NT$1 million after just two of its mobile numbers were exploited by scammers.
The commission said in a statement that it has ordered Chunghwa Telecom to suspend the transfer of the remaining 180,000 mobile phone numbers to Strait-Telecom.
“We have also inspected Strait-Telecom and examined whether it had thoroughly followed the ‘know your customer’ requirements as stated in telecom regulations. Chunghwa Telecom should suspend or terminate the communications of any mobile phone number that is involved in scams,” the commission said, adding that prosecutors are still investigating crimes committed using the numbers.
Taiwan Star is subject to regulation by the Telecommunication Management Act (電信管理法), while the Telecommunications Act (電信法) applies to the case involving Strait-Telecom, the commission said.
Comparing the penalties in these two cases would be meaningless as they are different in terms of severity, applicable laws, as well the fines that can be imposed, the commission said.
“Straits-Telecom was passive in accepting an administrative inspection and failed to provide remedial measures in accordance with the regulations. We have aggravated the sanction and strengthened supervision with some administrative means, but the relevant sanction must still be administered according to the law,” it said.
The commission said that Strait-Telecom’s license expired in May and it is no longer a telecom.
“However, in view of the serious offense, we have asked Chunghwa Telecom to list the company as a high-risk customer and strengthen the audit, random testing and risk control of similar clients,” it said.
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