1.  First in order to start compress forwarding you need to have your INIT.SRV set up correctly

# Use (when possible) forward type FBB (OK )
##############################################################################
# New in 5.15c45-51: Parametres: 
#  1  : A space is mandatory before the @ in a send message command
#  2  : The length of the fields of a hierarchical address is not  tested to be 6 characters
#  4  : The header line of a message is not truncated to the space before the 79th character
#*  8  : Header MBL/RLI
#  16 : If there is no BBS field, the callsign of the BBS is sent to the PMS
#*  32 : Deletes the DATA messages sent to SYSOP
#  64 : Don't use the BID recovered from headers and use a new one
#  128: Accepts forwarding only from pre-declared BBS
#*  256: WP Messages are not held.
#*  512: XForwarding protocole has priority on FBB protocole.
# 1024: Generation of an alternate BID like F6FBB-12345 (for dual BBS site)
# 2048: Checksum unvalidated on XFwd.
# 4096: Test of callsigns is less strict.  Allows all "callsigns" as long 
#       as they have one figure (0-9) anywhere in the callsign. 
OK 288    <----   ***   make sure this is set to ok 
##############################################################################
#
# Use (when possible) compressed forward (OK or NO)
# 
# Add 1 if forward-resume is allowed (should normally be..)
##############################################################################
# New in 5.15c51:
# Add 2 if XFWD is allowed  ********* FWD TYPE BINARY/COMPRESSED
#NO 0
OK 3  <----  ***
##############################################################################

2.  Then you need to explicitly indicate in your forward file to use compress forward.

*************************
* TELNET TCP/IP FORWARD 
*************************
A B1BBB
P A
IF C1
N 15  <----  use N15 here  ***
#  J 0
  R
  C C B1BBB 11.19.20.81 6300
  V .C2CCC$Wpassword$W    <---- put "." in front of callsign  ***
endif
#
F B1BBB
B B1BBB
G WW*
G EU*
----------

3.  Then be sure to turn off the echo by putting a "." in front of your callsign.

See 2. above

4. Other things that might effect fbb are located in your PORT.SYS file:

MaxFra- try reducing to 1
PacLen - Set to 230
MaxBloc - try setting to less than 10
A good starting point for Port.Sys is below
#TNC NbCh Com MultCh Pacln Maxfr NbFwd MxBloc M/P-Fwd Mode Freq
0         0         0      0           0       0        0           0           00/02 ---- File-fwd.
1          2         2     0           230    2       1           20         00/10 TU  TELNET