FCC Fines KXOL-FM in Los Angeles $8000 Over Contest

RADIO ONLINE | Monday, April 15, 2024

Federal Communications Commission

The FCC has levied a proposed fine of $8000 against Spanish Broadcasting System's KXOL-FM in Los Angeles for failing to conduct a contest in accordance with its announced terms and to deliver a prize to the winner in the prescribed time under the contest's terms. Despite being required to deliver prizes to winners within thirty business days, KXOL failed to meet its own deadline.

In proposing this penalty, the agency reiterated the Commission's commitment to protecting the public from deceptive broadcast contests. Under the Commission's rules, broadcast licensees must "fully and accurately disclose the material terms" of a licensee-conducted contest and conduct it "substantially as announced and advertised." Material terms "include any eligibility restrictions, means of selection of winners, and the extent, nature and value of prizes."

The Commission received a complaint alleging that KXOL did not conduct a contest in a manner substantially as announced by failing to award a promised cash prize of $396 to the winner, conducted on air on October 24, 2019. The Enforcement Bureau issued a Letter of Inquiry (LOI) investigating the complaint on June 16, 2021. KXOL submitted its timely response on July 16, 2021.

In its LOI response, KXOL admitted that there was an "undue delay" in issuing the contest prize and that it failed to issue the award within the applicable timeframe. The contest at issue, "Mega Bomba," aired from July 18, 2019 to October 25, 2019, with 459 winners. The contest terms provide, in two separate provisions, that each winner will be awarded their prize "within thirty business days of the date the winner completes all required station documents." KXOL acknowledged that the complainant had completed required documents on January 16, 2020. Despite this, KZOL issued the award in May, 2021.

KXOL attributed its "undue delay" to three different events: the COVID-19 pandemic, a ransomware attack that disabled corporate IT systems between October 2020 and March 2021 and after recovering from the ransomware attack, KXOL lacked the staff needed to complete the remaining work quickly.

The FCC found that KXOL's justifications for this delay did not excuse its liability for failure to issue the prize in accordance with its announced contest terms and issued a base forfeiture of $4,000 and concluded an upward adjustment was warranted making the proposed fine of $8000.