June 27, 2006 State of Indiana

The State of Indiana & ITS Intelenet Commission, an entity controlled by the State of Indiana, have agreed to pay nearly $8.3 Million relating to allegations of making false claims and false statements in connection with the Federal Communication Commission’s (FCC) E-Rate program.

The E-Rate program, created by congress in the Telecommunications Act of 1996 provides funding for needy schools and libraries to connect to and utilize the internet.  Under the E-Rate program, which is funded by monies collected from telephone users, schools apply for monies to provide for cabling, internet backbone equipment (i.e. servers OBX and switches), and to pay for monthly connectivity fees.  The FCC oversees the E-Rate program.

The allegations against Intelenet and the State of Indiana, were that they provided false information to the E-Rate Program and otherwise violated the program’s requirements, including charging inflated prices for services provided to Indiana Schools and libraries, falsifying invoices, and engaging in non-competitive bidding practices.  The settlement resolves claims which could have otherwise been pursued under the False Claims Act.

See U.S. Dept of Justice Press Release 6/27/06

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