How the FCC (and other agencies) put Americans out of work

By dragging American companies into federal court, suing them over nothing and confiscating large amounts of revenue that they call a "voluntary contribution", the FCC has become an Orwellian nightmare for many businesses.

The following is just one area where the FCC strikes fear into the hearts of business owners.  If you have a story of FCC or other government agency overreach, please email us so we can include it on this site.

Problem

Current policy requires manufacturers of digital products (that is, most electronic gadgets) to place a notification statement on their product or external packaging, and another statement in the owners manual or in the package box. These statements were written by the FCC long ago and must be copied verbatim. The statements are not up-to-date (eg. “Consult the dealer or an experienced radio/TV technician for help.”), not helpful, and generally, nobody reads them. (see attached page, “FCC Required Notices for Digital Equipment”)

The regulation requiring these statements was intended to inform consumers that the manufacturer had done the product testing necessary to ensure that the device would not cause radio frequency interference with other devices in the same vicinity. However, actual compliance with the law is not routinely checked by the FCC. (see FCC Declaration of Conformity)

Despite the dated and mostly ignored nature of these required statements, the FCC has been granted power to enforce their use by companies who manufacture and sell digital products. The enforcement can entail months of legal battles, followed by the eventual capitulation of the company by paying thousands, or sometimes millions of dollars to the FCC. These punitive actions are almost always as a result of a company forgetting to put the required statements on their products and/or in the packaging and have nothing to do with the offending product actually causing any interference. (See FCC ruling against Peavey Electronics Corp.  Note the “Voluntary Contribution” in item 1 of the Consent Decree. Nothing about it is voluntary.)

As an example of how the FCC has become an illegitimate profit center for the US Government, take a look at just some of the companies in the music products industry who have been unjustly fined for simply not having the required statement printed on their products and/or in manuals.  Here is a partial list of those music gear companies:

Music Companies Sued by the FCC for Lack of Labeling (a sampling):

AMS (American Music & Sound) - Penalty: $72,000

Behringer - Penalty: $1,000,000

Fender - Penalty: $265,000

Gallien-Krueger - Penalty: $18,500

Hanser Music Group - Penalty: $14,500

LOUD Technologies - Penalty: $85,000

Marshall - Penalty: $7,200

New Sensor/EHX - Penalty: $450,000

Peavey - Penalty: $225,000

PreSonus - Penalty: $125,000

Rane - Penalty: $61,500

If you would like to read the FCC judgments against these companies for yourself, they are available here.  Bear in mind that these are companies in a small niche industry, and that most of these companies are quite small.  You can imagine how widespread the government abuses of power must be if they’ve reached this far into the music products industry.  And this is just one of many government agencies who regularly put American businesses out of business. Think of how many people companies like these could hire, if the government would stop confiscating their cash over petty regulations.

The House Committee on Oversight & Government Reform released a report in November 2016, which “surveyed 34 agencies and found they collected over $83 billion in fines and penalties between 2010 and 2015, which were used to fund operations and unappropriated programs.”  This “did not include the fines and penalties collected by the IRS”, but was probably comprised of the sort of business-crippling penalties that the FCC imposes.  Amazingly, “the government’s accounting system to monitor and track the funds collected appears inadequate.”  So, we don’t even know what they’re doing with all the confiscated funds from victim companies, other than growing the bureaucracy.

Tell your elected representatives that if they really want to create jobs, they need to prevent government agencies like the FCC from taking away jobs.

Spirit of the Regulation

The original reason for the required statements was to simply inform consumers regarding potential radio interference and what to do about it.  Implied in the regulation was actual protection from radio frequency interference, designed into products by the manufacturer and tested by the FCC.  (The testing, however, is almost never actually done.)

Solution

First, remove the requirement to have the notification statements and take away the FCC's ability to fine companies for not having those statements.  This would involve deleting sections 5.19, 5.21 and 5.105 from Title 47 of the FCC Regulations.  As noted above, those sections are hopelessly out of date and should never have been required in the first place.  They certainly never should have been weaponized against US businesses for the purpose of raising money for the bureaucracy.

Second, allow penalized companies to apply for a return of funds previously confiscated by the FCC based on any/all of the sections being deleted.