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FCC Order Upholds USAC Audit Procedures

In a recent FCC Order, the Commission upheld a Wireline Competition Bureau decision denying Integrity Communications’ request for review of an audit letter issued by USAC.

In October 2007, Integrity Communications was sent a letter informing them that a beneficiary audit had revealed that they had prematurely billed USAC for services and equipment. Integrity was given six months to respond to the letter and submit a compliance plan. USAC stated that they would “take no action on funding requests involving Integrity until it reviewed Integrity’s plan and determined that it adequately addressed the non-compliance issue.”

Integrity Communications contested the validity of the audit letter and sought review by the Wireline Competition Bureau of USAC’s requirement of a compliance plan. During this time, Integrity did not submit a compliance plan. As a result, all pending commitments from Integrity were suspended. Integrity eventually submitted a compliance plan in December of 2009, nearly 18 months after the initial audit letter was sent.

Integrity Communications appealed Wireline Competition Bureau’s decision, arguing that the decision to suspend funding had violated their right to due process and that the Wireline Competition Bureau should have required USAC to process pending requests after the provider had submitted a compliance plan.

The Commission denied integrity Communications arguments, upholding the actions of USAC and the Wireline Competition Bureau, stating that USAC’s actions were compliant with its existing procedures and that Integrity Communications was not denied due process.

A complete copy of the Order can be found here.

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