BUTLER, Pa. – A Butler County-based Internet company has agreed to pay $6.5 million to settle allegations that it violated the False Claims Act by knowingly violating Federal Communications Commission (FCC) rules.
Armstrong Group was accused of violating the rules governing the agency’s high-cost program and of presenting improper costs in order to increase subsidies it received from the federal Universal Service Fund (USF).
“Telecommunications providers seeking to participate in important FCC programs such as the High Cost Program must comply with applicable rules, including those governing how they report the costs used to calculate their subsidies,” it said. Principal Deputy Assistant Attorney General Brian M. Boynton, head of the Justice Department’s Civil Division. Today’s settlement demonstrates our continued commitment to protecting the integrity of the FCC’s operations and services.
The FCC created the USF to help all people in the United States have access to fast, efficient, nationwide communications service with convenient facilities at reasonable rates.
“In the digital age, it is essential for everyone, everywhere to have access to reliable, high-speed broadband, including rural and underserved areas. That’s why we’re laser-focused on going after waste, fraud and abuse in these critical programs and ensuring that available funds flow to companies that play by the rules,” said FCC General Counsel Michele Ellison. “I applaud the continued collaboration between the Office of General Counsel, the Office of Inspector General and the US Department of Justice toward this important objective.”
Between 2008 and 2023, Armstrong Group allegedly failed to comply with FCC regulations governing what costs they were allowed to report for purposes of claiming government subsidy payments, and as a result received larger subsidy payments than they were entitled to , the Justice Department said.
“When providers like Armstrong Group fail to follow federal law and FCC regulations, they jeopardize not only critical government programs, but also consumers’ ability to access a modern lifeline — fast, reliable and efficient telecommunications services, ” said US Attorney Eric G. Olshan for the Western District of Pennsylvania. Today’s settlement demonstrates our office’s commitment to ensuring that the business community plays fairly, particularly with respect to public funds, and further assures our rural neighbors across the District that we will work vigorously to protect access their in essential services that many people take for granted.â€
In addition to the civil settlement, Armstrong Group has entered into a robust corporate compliance agreement with the FCC, requiring Armstrong to adopt concrete changes to the company’s internal controls and implement comprehensive oversight and monitoring mechanisms.
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