PITTSBURGH, PA (July 12, 2024) - A family-owned and operated Butler County telecommunications company has agreed to pay $6.5 million to the Federal Communications Commission to settle a whistleblower lawsuit brought by a former employee over false cost reports, which were allegedly submitted to the federal agency since 2008.
The Armstrong Group of Companies, led by third generation family members, has agreed to pay $6.5 million to settle allegations it submitted false claims to the FCC’s Universal Service Fund. The fund provides federal money for broadband expansion in rural or underserved areas so consumer rates for service are reasonably comparable to urban areas. The lawsuit, which was filed by former Armstrong controller and director of regulatory compliance James Ranko, alleged that Armstrong submitted inflated costs to increase federal subsidies it received.
Armstrong Telephone received tens of millions of dollars in federal subsidies under the FCC’s High Cost Program, also known as the Connect America Fund, according to Washington-based Phillips & Cohen LLP, the law firm representing Mr. Ranko.
Andrew Stone, from the Stone Law Firm in Pittsburgh, served as co-counsel.
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