[Federal Register Volume 77, Number 218 (Friday, November 9, 2012)]
[Notices]
[Pages 67363-67365]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2012-27348]


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FEDERAL COMMUNICATIONS COMMISSION

[DA 12-1620]


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 Ms. 
Denisa Babcock'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 
her. Ms. Babcock, or any person who has an existing contract with or 
intends to contract with her 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 December 10, 2012, 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 email at 
[email protected]. If Ms. Ragsdale is unavailable, you may contact 
Ms. Theresa Cavanaugh, Chief, Investigations and Hearings Division, by 
telephone at (202) 418-1420 and by email 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 12-1620, 
which was mailed to Ms. Babcock and released on October 10, 2012. 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

[[Page 67364]]

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 email 
http://www.bcpiweb.com.

Federal Communications Commission.

    Dated: October 10, 2012.
Theresa Z. Cavanaugh,
Chief, Investigations and Hearings Division, Enforcement Bureau.
DA 12-1620

SENT VIA CERTIFIED MAIL, RETURN RECEIPT REQUESTED AND EMAIL

Ms. Denisa Babcock, c/o Leon Fred Spies, Mellon & Spies, 312 E. College 
Street, Suite 216, Iowa City, IA 52240

Re: Notice of Suspension and Initiation of Debarment Proceedings FCC 
File No. EB-12-IH-1396

    Dear Ms. Babcock: The Federal Communications Commission 
(Commission) has received notice of your conviction, under 18 U.S.C. 
666(a)(1)(A) and (b), for theft of, among other amounts, funds 
associated with 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 E-Rate program debarment 
proceedings against you.\2\
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    \1\ Any further reference in this letter to ``your conviction'' 
refers to your guilty plea in United States v. Babcock, Criminal 
Docket No. 3:10-cr-00074-RP-TJS-1, Plea Agreement (S.D. Iowa, May 
11, 2011) (Plea Agreement).
    \2\ See 47 CFR 0.111 (delegating to the Bureau authority to 
resolve universal service suspension and debarment proceedings). The 
Commission adopted debarment rules for the E-Rate program 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 Sec.  
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, 16410-12 (2007) (Program 
Management Order) (renumbering Sec.  54.521 of the universal service 
debarment rules as Sec.  54.8 and amending subsections (a)(1), 
(a)(5), (c), (d), (e)(2)(i), (e)(3), (e)(4), and (g)).
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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 [E-Rate program]'' from 
receiving the benefits associated with that program.\3\ The 
Commission's rules are designed to ensure that all E-Rate funds are 
used for their intended purpose.\4\
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    \3\ Second Report and Order, 18 FCC Rcd at 9225, para. 66; 
Program Management Order, 22 FCC Rcd at 16387, para. 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\ NEC-Business Network Solutions, Inc., Notice of Debarment 
and Order Denying Waiver Petition, 21 FCC Rcd 7491, 7493, para. 7 
(2006).
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    On May 11, 2011, you pled guilty to converting more than $1,000,000 
belonging to various school districts for your personal use from 
November 2005 through December 2009.\5\ That amount included 
approximately $49,000 in E-Rate checks that had been payable to school 
districts you represented through your E-Rate consulting company, 
Camanche Consulting Services (CCS).\6\ According to your Plea 
Agreement, you knowingly deposited E-Rate checks payable to these 
school districts into your personal bank accounts without the authority 
to do so.\7\ Along with the other funds stolen from the various school 
districts, you used these stolen E-Rate funds to help pay off your home 
mortgage, fund retirement plans, and purchase vehicles, real property, 
a boat, travel, and personal items.\8\
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    \5\ Plea Agreement at 1, 17-18; see also United States 
Attorney's Office, Southern District of Iowa, News, Former Clinton 
Community School District Employee Pleads Guilty to Theft of Federal 
Funds, May 11, 2011, at http://www.justice.gov/usao/ias/news/2011/Babcock%20-%20plea%20-%20media%20release%20-%205-10-11.pdf (Press 
Release).
    \6\ Plea Agreement at 17.
    \7\  Id.
    \8\ Id. at 18.
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    On October 14, 2011, the United States District Court for the 
Southern District of Iowa sentenced you to serve 64 months in prison 
followed by a three-year period of supervised release.\9\ In addition, 
the court ordered you to pay $1,330,215.96 in restitution and a $100 
special assessment.\10\
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    \9\ United States v. Babcock, Criminal Docket No. 3:10-cr-00074-
RP-TJS-1, Amended Judgment at 2 (S.D. Iowa, entered Jan. 23, 2012) 
(Amended Judgment).
    \10\ Amended Judgment at 4-5. This restitution order includes: 
$8,061.77 payable to Bement Community School District Five; 
$2,231.28 payable to the Chester Area School District; $21,789.40 
payable to the Lena-Winslow School District; $17,933.80 payable to 
North Boone School District 200; $1,852.03 payable to Oldham Public 
Library; and $4,270.64 payable to West Carroll Community School 
District No. 314. Id. at 4. In addition, you were ordered to 
forfeit, among other items, E-Rate checks that FBI agents had seized 
from your residence. Plea Agreement at 6-7.
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    Pursuant to Sec.  54.8(b) of the Commission's rules,\11\ upon your 
conviction for theft of E-Rate funds, the Bureau is required to suspend 
you from participating in any activities associated with or related to 
the E-Rate program, including the receipt of funds or discounted 
services through the E-Rate program, or consulting with, assisting, or 
advising applicants or service providers regarding the E-Rate 
program.\12\ Your suspension becomes effective upon either your receipt 
of this letter or its publication in the Federal Register, whichever 
comes first.\13\
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    \11\ 47 CFR 54.8(a)(4); see Second Report and Order, 18 FCC Rcd 
at 9225-27, paras. 67-74.
    \12\ 47 CFR 54.8(a)(1), (d).
    \13\ Second Report and Order, 18 FCC Rcd at 9226, para. 69; 47 
CFR 54.8(e)(1).
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    In accordance with the Commission's suspension and debarment rules, 
you may contest this suspension or the scope of this suspension by 
filing arguments, with any relevant documents, within thirty (30) 
calendar days of your receipt of this letter or [INSERT DATE 30 DAYS 
AFTER DATE OF PUBLICATION IN THE FEDERAL REGISTER], whichever comes 
first.\14\ Such requests, however, will not ordinarily be granted.\15\ 
The Bureau may reverse or limit the scope of a suspension only upon a 
finding of extraordinary circumstances.\16\ The Bureau will decide any 
request to reverse or modify a suspension within ninety (90) calendar 
days of its receipt of such request.\17\
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    \14\ 47 CFR 54.8(e)(4).
    \15\ Id.
    \16\ 47 CFR 54.8(f).
    \17\ Second Report and Order, 18 FCC Rcd at 9226, para. 70; 47 
CFR 54.8(e)(5), (f).
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II. Initiation of Debarment Proceedings

    In addition to requiring your immediate suspension from the E-Rate 
program, your conviction is cause for debarment as defined in Sec.  
54.8(c) of the Commission's rules.\18\ Therefore,

[[Page 67365]]

pursuant to Sec.  54.8(b) of the Commission's rules, your conviction 
requires the Bureau to commence debarment proceedings against you.\19\
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    \18\ ``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.'' Id. 
54.8(a)(1).
    \19\ Id. 54.8(b).
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    As with the suspension process, you may contest the proposed 
debarment or the scope of the proposed debarment by filing arguments 
and any relevant documentation within thirty (30) calendar days of 
receipt of this letter or its publication in the Federal Register, 
whichever comes first.\20\ The Bureau, in the absence of extraordinary 
circumstances, will notify you of its decision to debar within ninety 
(90) calendar days of receiving any information you may have filed.\21\ 
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.\22\
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    \20\ Second Report and Order, 18 FCC Rcd at 9226, para. 70; 47 
CFR Sec.  54.8(e)(3).
    \21\ Second Report and Order, 18 FCC Rcd at 9226, para. 70; 47 
CFR. Sec.  54.8(e)(5).
    \22\ 47 CFR 54.8(e)(5). 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. Id. 
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 E-Rate program for three years from the date of debarment.\23\ 
The Bureau may set a longer debarment period or extend an existing 
debarment period if necessary to protect the public interest.\24\
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    \23\ Second Report and Order, 18 FCC Rcd at 9225, para. 67; 47 
CFR 54.8(d), (g).
    \24\ 47 CFR 54.8(g).
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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 SW., Room TW-A325, Washington, DC 20554 and to the 
attention of Joy M. Ragsdale, Attorney Advisor, Investigations and 
Hearings Division, Enforcement Bureau, Room 4-C330, Federal 
Communications Commission, 445 12th Street SW., Washington, DC 20554 
with a copy to Theresa Z. Cavanaugh, Division Chief, Investigations and 
Hearings Division, Enforcement Bureau, Room 4-C330, Federal 
Communications Commission, 445 12th Street SW., Washington, DC 20554. 
All messenger or hand delivery filings must be submitted without 
envelopes.\25\ 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 SW., Room 4-C330, Washington, DC 20554, with a copy to 
Theresa Z. Cavanaugh, Chief, Investigations and Hearings Division, 
Enforcement Bureau, Federal Communications Commission, 445 12th Street 
SW., Room 4-C330, Washington, DC 20554. You shall also transmit a copy 
of your response via email to Joy M. Ragsdale, [email protected] and 
to Theresa Z. Cavanaugh, [email protected].
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    \25\ 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) 418-1697. You may contact 
me at (202) 418-1553 or at the email address noted above if Ms. 
Ragsdale is unavailable.

 Sincerely yours,
Theresa Z. Cavanaugh,

Chief, Investigations and Hearings Division, Enforcement Bureau

cc: Johnnay Schrieber, Universal Service Administrative Company (via 
email); Rashann Duvall, Universal Service Administrative Company (via 
email); Maureen McGuire, United States Attorney's Office, Southern 
District of Iowa (via email); Richard Westphal, United States 
Attorney's Office, Southern District of Iowa (via email)

[FR Doc. 2012-27348 Filed 11-8-12; 8:45 am]
BILLING CODE 6712-01-P