                       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'?"

     CALL TO ACTION.  Your inputs and protests are needed now to
counter the long-distance company's claims that "no one was hurt by
their blocking actions because nobody complained."  Obviously nobody
complained for a long time because the line blocking was carried out
in such a manner that no one realized, until April 1988, what was
being done.

     Please read through the rest of this article (yes, it's long,
but you should find it very interesting) and judge for yourself.
Then, please write to the organizations listed at the end of the
article; insist that your right to telephone whatever number you
choose should not be impaired by the arbitrary decision of some
telephone company bureaucrat who really doesn't care about the rights
of his customers.  Protest in the strongest terms.  And, remember:
the rights you save WILL BE YOUR OWN!

     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.

     MEANWHILE, BACK AT THE RANCH.  You are now up-to-date on the
entire story.  Now, we are in the process of spreading the word so
that all interested people can contact the Iowa authorities so they
will get the message that this case is much bigger than the blocking
of one BBS.  YOU can help in two ways:

     First, upload this file to bulletin boards you call.  Let's get
this message distributed to BBS and modem users across the nation,
because the threat is truly to communications across the nation.

     Second, read the notice appended to this article, and ACT.  The
notice was distributed at the last meeting of Hawkeye PC Users'
Group.  If you are a Teleconnect customer, it is very important that
you write the agencies listed on the notice.  If you are not a
Teleconnect customer, but are interested in preserving your rights to
uninhibited communications, you can help the cause by writing to
those agencies, also.
   
     Please, people, write now!  Before it is too late!


                 T E L E C O N N E C T   C U S T O M E R S
              = = = = = = = = = = = = =   = = = = = = = = = = =

         If you are user of Teleconnect's long distance telephone service, 
    you need to be aware of their "blocking" policy:

         Teleconnect has been "lashing out" against the callers of 
    bulletin boards and other "computer numbers" by blocking access of 
    legitimate subscribers to certain phone numbers to which calls have 
    been made with fraudulent Teleconnect charge numbers.  Curt Kyhl's 
    Stock Exchange Bulletin Board in Waterloo has been "blocked" in such a 
    manner.  Teleconnect representatives have indicated that other 
    "computer numbers" have been the objects of similar action in the 
    past, and that they (Teleconnect) have a "right" to continue such 
    action in the future.

         Aside from the trampling of individual rights guaranteed by the 
    Bill of Rights of the U.S. Constitution, this arbitrary action serves 
    only to "punish the innocent" Teleconnect customers and bulletin board 
    operators, while doing absolutely nothing to identify, punish, or 
    obtain payment from the guilty.  The capping irony is that 
    Teleconnect, which advertises as offering significant savings over 
    AT&T long-distance rates, now suggests to complaining customers that 
    the blocked number can still be dialed through AT&T.       

         Please write to Teleconnect.  Explain how long you have been a 
    customer, that your modem generates a significant amount of the 
    revenue they collect from you, and that you strongly object to their 
    abritrarily deciding what numbers you may or may not call.  Challenge 
    their "right" to institute a "blocking" policy and insist that the 
    policy be changed.  Send your protests to:

                     Teleconnect Company
                     Mr. Dan Rogers, Vice President
                         for Customer Service
                     500 Second Avenue, S.E.
                     Cedar Rapids, Iowa  52401

         A complaint filed with the Iowa Utilities Board has been 
    initially resolved in favor of Teleconnect.  A request for 
    reconsideration has been filed, and the time is NOW for YOU to write 
    letters to the State of Iowa.  Please write NOW to:

                     Mr. Gerald W. Winter,
                          Supervisor, Consumer Services
                     Iowa State Utilities Board
                     Lucas State Office Building
                     Des Moines, Iowa  50319

         And to:

                     Mr. James Maret
                     Office of the Consumer Advocate
                     Lucas State Office Building
                     Des Moines, Iowa  50319

              Write now.  The rights you save WILL be your own.
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