[Federal Register Volume 76, Number 171 (Friday, September 2, 2011)]
[Notices]
[Pages 54768-54770]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2011-22598]


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FEDERAL COMMUNICATIONS COMMISSION

[DA 11-1424]


Notice of Suspension and Commencement of Proposed Debarment 
Proceedings; Schools and Libraries Universal Service Support Mechanism

AGENCY: Federal Communications Commission.

ACTION: Notice.

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SUMMARY: The Enforcement Bureau (the ``Bureau'') gives notice of Mr. 
Tyrone D. Pipkin's suspension from the schools and libraries universal 
service support mechanism (or ``E-Rate Program''). Additionally, the 
Bureau gives notice that debarment proceedings are commencing against 
him. Mr. Pipkin, or any person who has an existing contract with or 
intends to contract with him to provide or receive services in matters 
arising out of activities associated with or related to the schools and 
libraries support, may respond by filing an opposition request, 
supported by documentation to Joy Ragsdale, Federal Communications 
Commission, Enforcement Bureau, Investigations and Hearings Division, 
Room 4-C330, 445 12th Street, SW., Washington, DC 20554.

DATES: Opposition requests must be received by 30 days from the receipt 
of the suspension letter or October 3, 2011, whichever comes first. The 
Bureau will decide any opposition request for reversal or modification 
of suspension or debarment within 90 days of its receipt of such 
requests.

ADDRESSES: Federal Communications Commission, Enforcement Bureau, 
Investigations and Hearings Division, Room 4-C330, 445 12th Street, 
SW., Washington, DC 20554.

FOR FURTHER INFORMATION CONTACT: Joy Ragsdale, Federal Communications 
Commission, Enforcement Bureau, Investigations and Hearings Division, 
Room 4-C330, 445 12th Street, SW., Washington, DC 20554. Joy Ragsdale 
may be contacted by phone at (202) 418-1697 or e-mail at 
[email protected]. If Ms. Ragsdale is unavailable, you may contact 
Ms. Terry Cavanaugh, Acting Chief, Investigations and Hearings 
Division, by telephone at (202) 418-1420 and by e-mail at 
[email protected].

SUPPLEMENTARY INFORMATION: The Bureau has suspension and debarment 
authority pursuant to 47 CFR 54.8 and 47 CFR 0.111(a)(14). Suspension 
will help to ensure that the party to be suspended cannot continue to 
benefit from the schools and libraries mechanism pending resolution of 
the debarment process. Attached is the suspension letter, DA 11-1424, 
which was mailed to Mr. Pipkin and released on August 17, 2011. The 
complete text of the notice of suspension and initiation of debarment 
proceedings is available for public inspection and copying during 
regular business hours at the FCC Reference Information Center, Portal 
II, 445 12th Street, SW., Room CY-A257, Washington, DC 20554, In 
addition, the complete text is available on the FCC's Web site at 
http://www.fcc.gov. The text may also be purchased from the 
Commission's duplicating inspection and copying during regular business 
hours at the contractor, Best Copy and Printing, Inc., Portal II, 445 
12th Street, SW., Room CY-B420, Washington, DC 20554, telephone (202) 
488-5300 or (800) 378-3160, facsimile (202) 488-5563, or via e-mail 
http://www.bcpiweb.com.

Federal Communications Commission.
Theresa Z. Cavanaugh,
Acting Chief, Investigations and Hearings Division, Enforcement Bureau.

    The suspension letter follows:

August 17, 2011
DA 11-1424

SENT VIA CERTIFIED MAIL, RETURN RECEIPT REQUESTED AND FACSIMILE

Mr. Tyrone D. Pipkin
c/o Mr. Walter Francis Becker, Jr.
Chaffe McCall LLP
Energy Centre
1100 Poydras St., Suite 2300
New Orleans, LA 70163-2300

Re: Notice of Suspension and Initiation of Debarment Proceedings, 
File No. EB-11-IH-1071

Dear Mr. Pipkin:
    The Federal Communications Commission (``Commission'') has 
received notice of your conviction of conspiracy to defraud the 
United States in violation of 18 U.S.C. 371 in connection with your 
participation in the Federal schools and libraries universal service 
support mechanism (``E-Rate program'').\1\ Consequently, pursuant to 
47 CFR 54.8, this letter constitutes official notice of your 
suspension from the E-Rate program. In addition, the Enforcement 
Bureau (``Bureau'') hereby notifies you that the Bureau will 
commence debarment proceedings against you.\2\
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    \1\ Any further reference in this letter to ``your conviction'' 
refers to your conviction in United States v. Tyrone D. Pipkin, 
Criminal Docket Nos. 10-325 and 11-15 ``A'', Judgment (E.D.LA. filed 
June 21, 2011) (``Tyrone Pipkin Judgment'').
    \2\ See 47 CFR 54.8; 47 CFR 0.111 (delegating to the Enforcement 
Bureau authority to resolve universal service suspension and 
debarment proceedings). The Commission adopted debarment rules for 
the schools and libraries universal service support mechanism in 
2003. See Schools and Libraries Universal Service Support Mechanism, 
Second Report and Order and Further Notice of Proposed Rulemaking, 
18 FCC Rcd 9202 (2003) (``Second Report and Order'') (adopting 
section 54.521 to suspend and debar parties from the E-rate 
program). In 2007 the Commission extended the debarment rules to 
apply to all Federal universal service support mechanisms. 
Comprehensive Review of the Universal Service Fund Management, 
Administration, and Oversight; Federal-State Joint Board on 
Universal Service; Schools and Libraries Universal Service Support 
Mechanism; Rural Health Care Support Mechanism; Lifeline and Link 
Up; Changes to the Board of Directors for the National Exchange 
Carrier Association, Inc., Report and Order, 22 FCC Rcd 16372 app. C 
at 16410-12 (2007) (Program Management Order) (section 54.521 of the 
universal service debarment rules was renumbered as section 54.8 and 
subsections (a)(1), (5), (c), (d), (e)(2)(i), (3), (e)(4), and (g) 
were amended.)
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I. Notice of Suspension

    The Commission has established procedures to prevent persons who 
have ``defrauded the government or engaged in similar acts through 
activities associated with or related to the schools and libraries 
support mechanism'' from receiving the benefits associated with that 
program.\3\ Schools may

[[Page 54769]]

receive E-Rate program funding for eligible goods and services by 
filing application forms, seeking competitive bids, and selecting 
the most cost-effective vendor.\4\ To ensure the integrity of the 
program, the E-rate program rules prohibit an E-Rate vendor or 
anyone associated with an E-Rate vendor from participating in the 
application process or vendor selection.\5\
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    \3\ Second Report and Order, 18 FCC Rcd at 9225, paragraph 66; 
Program Management Order, 22 FCC Rcd at 16387, paragraph 32. The 
Commission's debarment rules define a ``person'' as ``[a]ny 
individual, group of individuals, corporation, partnership, 
association, unit of government or legal entity, however 
organized.'' 47 CFR 54.8(a)(6).
    \4\ 47 CFR 54.504, 54.511(c).
    \5\ See Request for Review by Mastermind Internet Services, 
Inc., Federal-State Joint Board on Universal Service, Changes to the 
Board of Directors of the National Exchange Carrier Association, 
Inc., CC Docket No. 96-45, Order, 16 FCC Rcd 4028, 4032-33 
paragraphs 10-12 (2000) (Mastermind Order) (finding that when an 
applicant surrenders control of the bidding process to an employee 
of an entity that will also participate in the bidding process as a 
prospective service provider, the applicant irreparably impairs its 
ability to hold a fair and open competitive bidding process); see 
also Universal Service Administrative Company's (``USAC'') 
description of an Open and Fair Competitive Bidding Process at 
http://www.universalservice.org/sl/applicants/step03/run-open-fair-competition.aspx.
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    On March 28, 2011, you entered a plea agreement and pleaded 
guilty to conspiring with others to defraud and obtain money from 
the E-Rate Program by controlling the application, bidding, and 
implementation process of the E-Rate program for schools located in 
four states.\6\ Specifically, you \7\ and a co-conspirator \8\ 
violated E-Rate program rules by completing E-Rate applications on 
behalf of Innovation Schools and other schools from December 2001 
through September 2005.\9\ Second, you and a co-conspirator 
obstructed the open competitive bidding process by concealing your 
relationship with a school official who devised a scheme to ensure 
Innovation Schools and other schools would hire GNT and Computer 
Training and Associates (``CTA'') as their E-Rate service 
providers.\10\ In exchange, you and a co-conspirator paid the school 
official $79,382 in bribes and kickbacks for steering E-Rate 
contracts to your companies.\11\ As a result of your assistance, 
Innovation Schools received more than $10,000 in Federal E-Rate 
funding in 2003, 2004 and 2005.\12\ Your company and CTA directly 
benefited from this scheme by receiving over $1.4 million in E-Rate 
work from Innovation Schools and other schools located in Florida 
and elsewhere.\13\ These actions constitute the conduct or 
transactions upon which this suspension notice and proposed 
debarment proceeding is based.\14\
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    \6\ United States v. Tyrone D. Pipkin, Criminal Docket No. 11-15 
``A'', Plea Agreement (E.D. La. 2011) (``Plea Agreement''). The 
conspiracy scheme involved schools in Arkansas, Florida, Illinois 
and Louisiana.
    \7\ Tyrone Pipkin is co-owner of Global Networking Technologies, 
Inc. (``GNT''), an E-Rate service provider hired by Innovation 
Schools and other schools located in four states.
    \8\ The Bureau will serve notice of suspension and initiation of 
debarment proceedings to Gloria F. Harper, co-owner of GNT and owner 
of CTA, who pleaded guilty to conspiracy on June 2, 2011, and awaits 
sentencing scheduled for the fall of 2011. See Justice News, DEP'T 
OF JUSTICE, Former Co-Owner of Illinois Technology Company Sentenced 
to Serve One Year and a Day in Prison for Role in Conspiracy to 
Defraud the Federal E-Rate Program, June 21, 2011, at http://www.justice.gov/opa/pr/2011/June/11-at-807.html (``Press Release'').
    \9\ United States v. Tyrone D. Pipkin, Criminal Docket No. 11-15 
``A'', Factual Basis at 2 (E.D. La. 2011) (``Factual Basis'').
    \10\ Factual Basis at 3, 4. See also United States v. Tyrone D. 
Pipkin, Docket No. 4:10cr67, Indictment at 2 (N.D. Fla. 2010).
    \11\ Factual Basis at 4. See also Press Release paragraph 4.
    \12\ Factual Basis at 4.
    \13\ Id.
    \14\ Second Report and Order, 18 FCC Rcd at 9226, paragraph 70; 
47 CFR 54.8(e)(2)(i).
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    On June 21, 2011, the United States District Court for the 
Eastern District of Louisiana sentenced you to serve one year and a 
day in prison followed by a two year period of supervised release 
for conspiring to defraud the Federal E-Rate program in multiple 
states.\15\ The court also ordered you to pay a $6,000 criminal fine 
for your role in the conspiracy scheme.\16\
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    \15\ Judgment at 2 (The prison term is one year and a day for 
both Count one of Case No. 10-325 and Count one of Case No. 11-15 
``A''. Both terms will run concurrently for a total prison term of 
one year and one day.).
    \16\ Judgment at 5. You were also ordered to immediately pay a 
$200 Special Assessment. Id.
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    Pursuant to Sec.  54.8(b) of the Commission's rules,\17\ upon 
your conviction the Bureau is required to suspend you from 
participating in any activities associated with or related to the 
schools and libraries support mechanism, including the receipt of 
funds or discounted services through the schools and libraries 
support mechanism, or consulting with, assisting, or advising 
applicants or service providers regarding the schools and libraries 
support mechanism.\18\ Your suspension becomes effective upon 
receipt of this letter or publication of the notice in the Federal 
Register, whichever comes first.\19\
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    \17\ 47 CFR 54.8(b). See Second Report and Order, 18 FCC Rcd at 
9225-9227, paragraphs 67-74.
    \18\ 47 CFR 54.8(a)(1), (d).
    \19\ Second Report and Order, 18 FCC Rcd at 9226, paragraphs 69; 
47 CFR 54.8(e)(1).
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    In accordance with the Commission's debarment rules, you may 
contest this suspension or the scope of this suspension by filing 
arguments, with any relevant documents, within 30 calendar days 
after receipt of this letter or after a notice is published in the 
Federal Register, whichever comes first.\20\ Such requests, however, 
will not ordinarily be granted.\21\ The Bureau may reverse or limit 
the scope of suspension only upon a finding of extraordinary 
circumstances.\22\ Absent extraordinary circumstances, the Bureau 
will decide any request to reverse or modify a suspension within 90 
calendar days of its receipt of such request.\23\
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    \20\ 47 CFR 54.8(e)(4).
    \21\ Id.
    \22\ 47 CFR 54.8(f).
    \23\ Second Report and Order, 18 FCC Rcd at 9226, paragraph 70; 
47 CFR 54.8(e)(5), (f).
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II. Initiation of Debarment Proceedings

    As discussed above, your guilty plea and conviction of criminal 
conduct in connection with the E-Rate program serves as a basis for 
immediate suspension from the program, as well as a basis to 
commence debarment proceedings against you. Conviction of criminal 
fraud is cause for debarment as defined in Sec.  54.8(c) of the 
Commission's rules.\24\ Therefore, pursuant to Sec.  54.8(b) of the 
rules, your conviction requires the Bureau to commence debarment 
proceedings against you.\25\
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    \24\ ``Causes for suspension and debarment are conviction of or 
civil judgment for attempt or commission of criminal fraud, theft, 
embezzlement, forgery, bribery, falsification or destruction of 
records, making false statements, receiving stolen property, making 
false claims, obstruction of justice and other fraud or criminal 
offense arising out of activities associated with or related to the 
schools and libraries support mechanism, the high-cost support 
mechanism, the rural healthcare support mechanism, and the low-
income support mechanism.'' 47 CFR 54.8(c). Associated activities 
``include the receipt of funds or discounted services through [the 
Federal universal service] support mechanisms, or consulting with, 
assisting, or advising applicants or service providers regarding 
[the Federal universal service] support mechanisms.'' 47 CFR 
54.8(a)(1).
    \25\ 47 CFR 54.8(b).
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    As with the suspension process, you may contest debarment or the 
scope of the proposed debarment by filing arguments and any relevant 
documentation within 30 calendar days of receipt of this letter or 
publication in the Federal Register, whichever comes first.\26\ The 
Bureau, in the absence of extraordinary circumstances, will notify 
you of its decision to debar within 90 calendar days of receiving 
any information you may have filed.\27\ If the Bureau decides to 
debar you, its decision will become effective upon either your 
receipt of a debarment notice or publication of the decision in the 
Federal Register, whichever comes first.\28\
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    \26\ Second Report and Order, 18 FCC Rcd at 9226, paragraph 70; 
47 CFR 54.8(e)(3).
    \27\ Id., 18 FCC Rcd at 9226, paragraph 70; 47 CFR 54.8(e)(5).
    \28\ Id. The Commission may reverse a debarment, or may limit 
the scope or period of debarment upon a finding of extraordinary 
circumstances, following the filing of a petition by you or an 
interested party or upon motion by the Commission. 47 CFR 54.8(f).
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    If and when your debarment becomes effective, you will be 
prohibited from participating in activities associated with or 
related to the schools and libraries support mechanism for three 
years from the date of debarment.\29\ The Bureau may set a longer 
debarment period or extend an existing debarment period if necessary 
to protect the public interest.\30\
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    \29\ Second Report and Order, 18 FCC Rcd at 9225, paragraph 67; 
47 CFR 54.8(d), (g).
    \30\ Id.
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    Please direct any response, if sent by messenger or hand 
delivery, to Marlene H. Dortch, Secretary, Federal Communications 
Commission, 445 12th Street, S.W., Room TW-A325, Washington, D.C. 
20554, to the attention of Joy M. Ragsdale, Attorney Advisor, 
Investigations and Hearings Division, Enforcement Bureau, Room 4-
A236, with a copy to Theresa Z. Cavanaugh, Acting Division Chief, 
Investigations and Hearings Division, Enforcement Bureau, Room 4-
C322, Federal Communications

[[Page 54770]]

Commission. All messenger or hand delivery filings must be submitted 
without envelopes.\31\ If sent by commercial overnight mail (other 
than U.S. Postal Service (``USPS'') Express Mail and Priority Mail), 
the response must be sent to the Federal Communications Commission, 
9300 East Hampton Drive, Capitol Heights, Maryland 20743. If sent by 
USPS First Class, Express Mail, or Priority Mail, the response 
should be addressed to Joy Ragsdale, Attorney Advisor, 
Investigations and Hearings Division, Enforcement Bureau, Federal 
Communications Commission, 445 12th Street, S.W., Room 4-A236, 
Washington, D.C. 20554, with a copy to Theresa Z. Cavanaugh, Acting 
Division Chief, Investigations and Hearings Division, Enforcement 
Bureau, Federal Communications Commission, 445 12th Street, S.W., 
Room 4-C322, Washington, D.C. 20554. You shall also transmit a copy 
of your response via e-mail to Joy M. Ragsdale, [email protected] 
and to Theresa Z. Cavanaugh, [email protected].
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    \31\ See FCC Public Notice, DA 09-2529 for further filing 
instructions (rel. Dec. 3, 2009).
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    If you have any questions, please contact Ms. Ragsdale via U.S. 
postal mail, email, or by telephone at (202) 418-7931. You may 
contact me at (202) 418-1420 or at the email address noted above if 
Ms. Ragsdale is unavailable.

Sincerely yours,

Theresa Z. Cavanaugh
Acting Chief
Investigations and Hearings Division
Enforcement Bureau

cc: Johnnay Schrieber, Universal Service Administrative Company (via 
email) Rashann Duvall, Universal Service Administrative Company (via 
email) Juan Rodriguez, Antitrust Division, United States Department 
of Justice (via email) Marvin Opotowsky, Antitrust Division, United 
States Department of Justice (via email)

[FR Doc. 2011-22598 Filed 9-1-11; 8:45 am]
BILLING CODE 6712-01-P