IBM resolve FCC probes by paying $24.25 million

IBM resolve FCC probes
FILE PHOTO: A man stands near an IBM logo at the Mobile World Congress in Barcelona, Spain, February 25, 2019. REUTERS/Sergio Perez

WASHINGTON (Reuters) – IBM Corp has agreed to pay $24.25 million to resolve a probes which is a pair of Federal Communications Commission (FCC) inquiries into subsidies awarded to link broadband schools and libraries.

Moreover, the payment from IBM will end two FCC investigations that have spanned almost 15 years in connection with the school districts of New York City and El Paso over their alleged violations of “E-Rate” programme laws. Under the deal, IBM decided to refund $24.25 million. However, it did not admit guilt, to the Universal Service Fund that finances the E-Rate programme.

Federal Communications Commission (FCC)

Federal Communications Commission (FCC)

In addition, the FCC reported that its inquiries found that IBM did not comply with the 2005-2008 competitive bidding rules in New York. After that, it also offered ineligible equipment and services in El Paso in 2001.

In a statement, IBM said it believed it “acted appropriately in its support of the E-rate programme. However, in the interest of amicably resolving a longstanding matter we are pleased to have reached this settlement”

IBM added that through the E-rate initiative. It has provided internet access to thousands of U.S. schools and libraries and millions of American students.

The commission “must protect the Universal Service Fund from waste, fraud, and abuse. It can ensure that funding is distributed in the most cost-effective manner” FCC Chairman Ajit Pai said.

Both telecommunications providers pay into the Universal Service Fund to link people in rural areas, provide subsidies through the Lifeline programme for low-income Americans, extend service in tribal lands, and aid through the E-rate programme for schools and libraries.


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IBM will pay $24.25 million to resolve FCC probes

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