[Federal Register: March 10, 2008 (Volume 73, Number 47)]
[Notices]
[Page 12733-12735]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr10mr08-55]
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FEDERAL COMMUNICATIONS COMMISSION
[[DA 08-300]
Notice of Suspension and Initiation of Debarment Proceedings;
Schools and Libraries Universal Service Support Mechanism
AGENCY: Federal Communications Commission.
ACTION: Notice.
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SUMMARY: The Enforcement Bureau (the ``Bureau'') gives notice of Mr.
Thomas J. Kennedy III's suspension from the schools and libraries
universal service support mechanism (or ``E-Rate Program'').
Additionally, the Bureau gives notice that debarment proceedings are
commencing against him. Mr. Kennedy, or any person who has an existing
contract with or intends to contract with him to provide or receive
services in matters arising out of activities associated with or
related to the schools and libraries support, may respond by filing an
opposition request, supported by documentation to Diana Lee, Federal
Communications Commission, Enforcement Bureau, Investigations and
Hearings Division, Room 4-C330, 445 12th Street, SW., Washington, DC
20554.
DATES: Opposition requests must be received by April 9, 2008 . However,
an opposition request by the party to be suspended must be received 30
days from the receipt of the suspension letter or April 9, 2008,
whichever comes first. The Bureau will decide any opposition request
for reversal or modification of suspension or debarment within 90 days
of its receipt of such requests.
FOR FURTHER INFORMATION CONTACT: Diana Lee, Federal Communications
Commission, Enforcement Bureau, Investigations and Hearings Division,
Room 4-C330, 445 12th Street, SW., Washington, DC 20554. Diana Lee may
be contacted by phone at (202) 418-0843 or e-mail at diana.lee@fcc.gov.
If Ms. Lee is unavailable, you may contact Ms. Vickie Robinson,
Assistant Chief, Investigations and Hearings Division, by telephone at
(202) 418-1420 and by e-mail at vickie.robinson@fcc.gov.
SUPPLEMENTARY INFORMATION: The Bureau has suspension and debarment
authority pursuant to 47 CFR 54.8 and 47 CFR 0.111. Suspension will
help to ensure that the party to be suspended cannot continue to
benefit from the schools and libraries mechanism pending resolution of
the debarment process. Attached is the suspension letter, DA 08-300,
which was mailed to Mr. Kennedy and released on February 6, 2008. The
complete text of the notice of debarment is available for public
inspection and copying during regular business hours at the FCC
Reference Information Center, Portal II, 445 12th Street, SW., Room CY-
A257, Washington, DC 20554. In addition, the complete text is available
on the FCC's Web site at http://www.fcc.gov. The text may also be
purchased from the Commission's duplicating inspection and copying
during regular business hours at the contractor, Best Copy and
Printing, Inc., Portal II, 445 12th Street, SW., Room CY-B420,
Washington, DC 20554, telephone (202) 488-5300 or (800) 378-3160,
facsimile (202) 488-5563, or via e-mail http://www.bcpiweb.com.
Federal Communications Commission.
Trent B. Harkrader,
Deputy Chief, Investigations and Hearings Division, Enforcement Bureau.
The attached is the Suspension and Initiation of Debarment Letter
to Thomas J. Kennedy III.
February 6, 2008.
DA 08-300
VIA Certified Mail
Return Receipt Requested and Facsimile (203-977-7301)
Mr. Thomas J. Kennedy III, c/o Stanley A. Twardy, Jr., Day Pitney
LLP, One Canterbury Green, Stamford, CT 06901-2047, E-mail:
satwardy@daypitney.com
Re: Notice of Suspension and Initiation of Debarment Proceedings, File
No. EB-08-IH-0285
Dear Mr. Kennedy: The Federal Communications Commission (``FCC'' or
``Commission'') has received notice of your conviction for mail fraud
in violation of 18 U.S.C. 1341 in connection with your participation in
the schools and libraries universal service support mechanism (``E-Rate
program'').\1\ Consequently, pursuant to 47 CFR 54.8, this letter
constitutes official notice of your suspension from the E-Rate program.
In addition, the Enforcement Bureau (``Bureau'') hereby notifies you
that we are commencing debarment proceedings against you.\2\
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\1\ Any further reference in this letter to ``your conviction''
refers to your February 13, 2007 guilty plea and subsequent
conviction of mail fraud. United States v. Thomas J. Kennedy III,
Criminal Docket No. 3:07-CR-186 (RNC), Plea Agreement (D. Conn.
filed Aug. 24, 2007 and entered Aug. 27, 2007) (``Kennedy Plea
Agreement''), Judgment (D. Conn. filed and entered Jan. 24, 2008)
(``Kennedy Judgment'').
\2\ 47 CFR 54.8; 47 CFR 0.111 (delegating to the Enforcement
Bureau authority to resolve universal service suspension and
debarment proceedings). The Commission adopted debarment rules for
the schools and libraries universal service support mechanism in
2003. See Schools and Libraries Universal Service Support Mechanism,
Second Report and Order and Further Notice of Proposed Rulemaking,
18 FCC Rcd 9202 (2003) (``Second Report and Order'') (adopting
section 54.521 to suspend and debar parties from the E-rate
program). In 2007, the Commission extended the debarment rules to
apply to all of the Federal universal service support mechanisms.
Comprehensive Review of the Universal Service Fund Management,
Administration, and Oversight; Federal-State Joint Board on
Universal Service; Schools and Libraries Universal Service Support
Mechanism; Lifeline and Link Up; Changes to the Board of Directors
for the National Exchange Carrier Association, Inc., Report and
Order, 22 FCC Rcd 16372, 16410-12 (2007) (Program Management Order)
(renumbering section 54.521 of the universal service debarment rules
as section 54.8 and amending subsections (a)(1), (5), (c), (d),
(e)(2)(i), (3), (e)(4), and (g)).
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[[Page 12734]]
I. Notice of Suspension
The Commission has established procedures to prevent persons who
have ``defrauded the government or engaged in similar acts through
activities associated with or related to the schools and libraries
support mechanism'' from receiving the benefits associated with that
program.\3\ You pled guilty to mail fraud for activities in connection
with your participation in the E-Rate program involving
telecommunications upgrade projects in four Connecticut school
districts.\4\ While employed as an account manager for a company that
had a partnership arrangement with Southwestern Bell Communications
(``SBC''), you participated in a scheme to defraud SBC and the E-Rate
program.\5\ You and three SBC employees, including Richard E. Brown and
Keith J. Madeiros, decided that engineers would be hired for E-Rate
funded projects and that the cost of these engineering services would
be billed at inflated rates first to SBC and later to a SBC
subcontractor.\6\ SBC paid the invoices and then submitted those
invoices to USAC seeking excessive reimbursement from the E-rate
funds.\7\ The invoices were inflated by more than $500,000.\8\ You
admitted that payments for the inflated amount were split primarily
among you, Mr. Brown, and Mr. Madeiros and that you received
$249,525.\9\
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\3\ See Second Report and Order, 18 FCC Rcd at 9225, para. 66;
Program Management Order, 22 FCC Rcd at 16387, para. 32. The
Commission's debarment rules define a ``person'' as ``[a]ny
individual, group of individuals, corporation, partnership,
association, unit of government or legal entity, however,
organized.'' 47 CFR 54.8(a)(6).
\4\ See Kennedy Plea Agreement at 1; United States v. Thomas J.
Kennedy III, Criminal Docket No. 3:07-CR-186 (RNC), Information,
paras. 7-28 (D. Conn. filed Aug. 24, 2007 and entered Aug. 27, 2007)
(``Kennedy Information''); http://www.usdoj.gov/usao/ct/Press2008/
20080123-5.html (last accessed Jan. 25, 2008) (``DOJ January 23,
2008 Press Release'').
\5\ See Kennedy Information at paras. 13-15; DOJ January 23,
2008 Press Release at 1.
\6\ See Kennedy Information at paras. 15-28; DOJ January 23,
2008 Press Release at 1. The Bureau has debarred Richard E. Brown
from the E-Rate program. See Letter from Hillary S. DeNigro to
Richard E. Brown, Notice of Debarment, 22 FCC Rcd 20569 (Enf. Bur.,
Investigations & Hearings Div., rel. Nov. 27, 2007); 72 FR 73821
(Dec. 28, 2007). The Bureau has suspended Keith J. Madeiros from the
E-Rate program and initiated debarment proceedings against him. See
Letter from Hillary S. DeNigro to Keith J. Madeiros, Notice of
Suspension and Initiation of Debarment Proceedings, DA 08-129 (Enf.
Bur., Investigations & Hearings Div., rel. Jan. 18, 2008).
\7\ See Kennedy Information at paras. 21, 26; DOJ January 23,
2008 Press Release at 1.
\8\ See id.
\9\ See id.
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Pursuant to section 54.8(a)(4) of the Commission's rules,\10\ your
conviction requires the Bureau to suspend you from participating in any
activities associated with or related to the schools and libraries fund
mechanism, including the receipt of funds or discounted services
through the schools and libraries fund mechanism, or consulting with,
assisting, or advising applicants or service providers regarding the
schools and libraries support mechanism.\11\ Your suspension becomes
effective upon the earlier of your receipt of this letter or
publication of notice in the Federal Register.\12\
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\10\ 47 CFR 54.8(a)(4). See Second Report and Order, 18 FCC Rcd
at 9225-9227, paras. 67-74.
\11\ 47 CFR 54.8(a)(1), (d).
\12\ Second Report and Order, 18 FCC Rcd at 9226, para. 69; 47
CFR 54.8(e)(1).
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Suspension is immediate pending the Bureau's final debarment
determination. In accordance with the Commission's debarment rules, you
may contest this suspension or the scope of this suspension by filing
arguments in opposition to the suspension, with any relevant
documentation. Your request must be received within 30 days after you
receive this letter or after notice is published in the Federal
Register, whichever comes first.\13\ Such requests, however, will not
ordinarily be granted.\14\ The Bureau may reverse or limit the scope of
suspension only upon a finding of extraordinary circumstances.\15\
Absent extraordinary circumstances, the Bureau will decide any request
for reversal or modification of suspension within 90 days of its
receipt of such request.\16\
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\13\ 47 CFR 54.8(e)(4).
\14\ Id.
\15\ 47 CFR 54.8(e)(5).
\16\ See Second Report and Order, 18 FCC Rcd at 9226, para 70;
47 CFR 54.8(e)(5), 54.8(f).
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II. Initiation of Debarment Proceedings
Your guilty plea to and conviction of criminal conduct in
connection with the E-Rate program, in addition to serving as a basis
for immediate suspension from the program, also serves as a basis for
the initiation of debarment proceedings against you. Your conviction
falls within the categories of causes for debarment defined in section
54.8(c) of the Commission's rules.\17\ Therefore, pursuant to section
54.8(a)(4) of the Commission's rules, your conviction requires the
Bureau to commence debarment proceedings against you.
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\17\ ``Causes for suspension and debarment are the conviction of
or civil judgment for attempt or commission of criminal fraud,
theft, embezzlement, forgery, bribery, falsification or destruction
of records, making false statements, receiving stolen property,
making false claims, obstruction of justice and other fraud or
criminal offense arising out of activities associated with or
related to the schools and libraries support mechanism, the high-
cost support mechanism, the rural healthcare support mechanism, and
the low-income support mechanism.'' 47 CFR 54.8(c). Such activities
``include the receipt of funds or discounted services through [the
Federal universal service] support mechanisms, or consulting with,
assisting, or advising applicants or service providers regarding
[the Federal universal service] support mechanisms.'' 47 CFR
54.8(a)(1).
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As with your suspension, you may contest debarment or the scope of
the proposed debarment by filing arguments and any relevant
documentation within 30 calendar days of the earlier of the receipt of
this letter or of publication in the Federal Register.\18\ Absent
extraordinary circumstances, the Bureau will debar you.\19\ Within 90
days of receipt of any opposition to your suspension and proposed
debarment, the Bureau, in the absence of extraordinary circumstances,
will provide you with notice of its decision to debar.\20\ If the
Bureau decides to debar you, its decision will become effective upon
the earlier of your receipt of a debarment notice or publication of the
decision in the Federal Register.\21\
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\18\ See Second Report and Order, 18 FCC Rcd at 9226, para 70;
47 CFR 54.8(e)(3).
\19\ Second Report and Order, 18 FCC Rcd at 9227, para 74.
\20\ See id., 18 FCC Rcd at 9226, para 70; 47 CFR 54.8(e)(5).
\21\ Id. The Commission may reverse a debarment, or may limit
the scope or period of debarment upon a finding of extraordinary
circumstances, following the filing of a petition by you or an
interested party or upon motion by the Commission. 47 CFR 54.8(f).
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If and when your debarment becomes effective, you will be
prohibited from participating in activities associated with or related
to the schools and libraries support mechanism for three years from the
date of debarment.\22\ The Bureau may, if necessary to protect the
public interest, extend the debarment period.\23\
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\22\ Second Report and Order, 18 FCC Rcd at 9225, para 67; 47
CFR 54.8(d), 54.8(g).
\23\ Id.
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Please direct any response, if by messenger or hand delivery, to
Marlene
[[Page 12735]]
H. Dortch, Secretary, Federal Communications Commission, 236
Massachusetts Avenue, NE., Suite 110, Washington, DC 20002, to the
attention of Diana Lee, Attorney Advisor, Investigations and Hearings
Division, Enforcement Bureau, Room 4-C330, with a copy to Vickie
Robinson, Assistant Chief, Investigations and Hearings Division,
Enforcement Bureau, Room 4-C330, Federal Communications Commission. If
sent by commercial overnight mail (other than U.S. Postal Service
Express Mail and Priority Mail), the response should be sent to the
Federal Communications Commission, 9300 East Hampton Drive, Capitol
Heights, Maryland 20743. If sent by first-class, Express, or Priority
mail, the response should be sent to Diana Lee, Attorney Advisor,
Investigations and Hearings Division, Enforcement Bureau, Federal
Communications Commission, 445 12th Street, SW., Room 4-C330,
Washington, DC 20554, with a copy to Vickie Robinson, Assistant Chief,
Investigations and Hearings Division, Enforcement Bureau, Federal
Communications Commission, 445 12th Street, SW., Room 4-C330,
Washington, DC 20554. You shall also transmit a copy of the response
via e-mail to diana.lee@fcc.gov and to vickie.robinson@fcc.gov.
If you have any questions, please contact Ms. Lee via mail, by
telephone at (202) 418-1420 or by e-mail at diana.lee@fcc.gov. If Ms.
Lee is unavailable, you may contact Ms. Vickie Robinson, Assistant
Chief, Investigations and Hearings Division, by telephone at (202) 418-
1420 and by e-mail at vickie.robinson@fcc.gov.
Trent B. Harkrader,
Deputy Chief, Investigations and Hearings Division, Enforcement Bureau.
cc: Kristy Carroll, Esq., Universal Service Administrative Company (via
e-mail) Anthony E. Kaplan, Esq., Supervisory Assistant United States
Attorney Calvin B. Kurimai, Esq., Assistant United States Attorney
[FR Doc. E8-4588 Filed 3-7-08; 8:45 am]
BILLING CODE 6712-01-P