Posted on 08/06/2003 2:19:52 AM PDT by kattracks
And then there were two.Sprint, the third-largest long-distance phone company, may join MCI/WorldCom - in being suspended from winning federal contracts.
Government investigators recommended considering that Sprint be barred from federal work for overbilling practices.
The move is "unprecedented and totally without merit," Sprint said in a statement.
Sprint, which gets more than $600 million annually from the U.S., agreed in June to pay $5.2 million to settle Justice Department charges it defrauded federal clients.
Sprint didn't admit to wrongdoing. The General Services Administration that month initiated similar proceedings against MCI, which last week was suspended from federal contracts amid an $11 billion accounting scandal.
"It does seem like the government, in light of the MCI events, is more sensitive," said Legg Mason communications policy analyst David Kaut.
"Everyone in the company is outraged over this," Sprint spokesman James Fisher said. "This was nothing more than a billing error."
The government charges against Sprint originated from a whistleblower's lawsuit that accused the company of padding fees for connecting calls to local carriers from April 2000 through September 2002.
A change in software Sprint uses caused it to accidentally overcharge the government by $2.6 million, Fisher said, adding the error stopped when it was discovered.
Bloomberg News
Originally published on August 6, 2003
Did Sprint return the money?
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