IBM agreed to pay $24.25 million in fines to resolve two FCC investigations regarding its subsidies to schools and libraries for broadband access. The probes span15 years.
The FCC alleged IBM violated “E-Rate” program rules in connection with New York City and El Paso school districts. IBM has agreed to return $24.25 million to the Universal Service Fund that supports the E-Rate program, but did not admit wrongdoing.
In a statement, IBM said it believed it “acted appropriately in its support of the E-rate program, but in the interest of amicably resolving a longstanding matter we are pleased to have reached this settlement,” and added it had provided internet connectivity to thousands of U.S. schools and libraries and millions of American students through the E-rate program.
FCC Chairman Ajit Pai said the commission “must protect the Universal Service Fund from waste, fraud, and abuse and ensure that funding is distributed in the most cost-effective manner”.
U.S. telecommunications carriers contribute to the Universal Service Fund that pays to connect people in rural areas, provide subsidies for low-income Americans through the Lifeline program, expand service in Tribal lands and assist schools and libraries through the E-rate program.