WASHINGTON-Inter-Tel Technologies Inc. said Wednesday it had reached a settlement with the Department of Justice regarding crimes involving E-rate abuses.
The settlement will cost Inter-Tel Technologies about $9.5 million including legal fees. The company pled guilty to mail fraud and an antitrust violation.
“We are pleased to be reaching this settlement. While the employees directly involved with the matters in question are no longer associated with Inter-Tel in any form, we take full responsibility for their actions. We have begun to implement and will expand to a more rigorous compliance program, including review of current and future government contracts. We will not tolerate any conduct that causes anyone to question the integrity of our company,” said Steven Mihaylo, Inter-Tel chairman and chief executive officer.
The plea agreement requires judicial approval before it is final, said Inter-Tel.
Since the creation of the E-rate program, allegations of waste, fraud and abuse have consistently grown with the Justice Department and the Federal Communications Commission-under congressional pressure-working to stop those committing abuses.
The $2.5 billion subsidy Schools & Libraries program administered as part of the universal-service program has both critics and champions in Congress, but even the champions have warned the program could be in danger if abuses go unchecked.
