1. (a)

   1. (1) If a residential customer has paid all bills by the due date for the last twelve (12) months, an LEC must promptly refund the deposit.
   2. (2) LECs are not required to refund deposits on business or commercial accounts until the account is closed.
   3. (3) Refunds may be made through a credit on the next billing cycle.

   4. (4) Exceptions.

      1. (A) Fraud or tampering. If the reason for requiring a deposit is unauthorized use of service or tampering with the LEC’s equipment, an LEC does not have to refund the deposit until an account is closed.
      2. (B) Bankruptcy. If the deposit was subject to the jurisdiction of the United States Bankruptcy Courts, the LEC shall comply with the United States Bankruptcy Code in refunding or retaining the deposit.

2. (b)

   1. (1) When an account is closed, an LEC shall apply any deposit and accrued interest to the amount due the LEC.
   2. (2) The LEC shall promptly refund any balance due the depositor.

Codification Notes: This section was promulgated as Rule 4.05 of the Telecommunications Providers Rules prior to codification in the Code of Arkansas Rules.