WASHINGTON-A House panel could hold a hearing later this month on a $2.25 billion federal program that subsidizes wireline and wireless Internet connections to schools and libraries, continuing an ongoing congressional probe that some officials predict will unearth massive fraud and corruption.
Just last week, the Justice Department announced a guilty plea in connection with education discounts, or E-rate, awards in a central California elementary school district. The department also publicly stated for the first time its antitrust unit is pursuing a nationwide investigation of E-rate contracting.
Colorado’s Duane Maynard pleaded guilty to bid rigging, and under a plea agreement, has pledged to help the government in its wide-ranging investigation of E-rate bid rigging and fraud. E-rate is a popular bipartisan program included in the 1996 telecom act.
“The antitrust division will vigorously prosecute those who conspire to circumvent the competition requirements of federal programs,” said R. Hewitt Pate, assistant attorney general for antitrust. “Bid-rigging schemes aimed at the E-rate program rob funds for economically disadvantaged schools and libraries across the nation.”
Last December, federal prosecutors in New York filed criminal charges against officials at Connect2 Internet Network for allegedly trying to bilk millions of dollars from the E-rate program.
The Federal Communication Commission’s inspector general has repeatedly flagged E-rate as a source of possible widespread abuse and fraud.
