House Suspends Hill Telecom License
Thursday, September 28, 2006
House leaders have suspended a multimillion-dollar wireless communications license that federal prosecutors say was corruptly awarded to a Dulles telecommunications firm by Rep. Robert W. Ney (R-Ohio) in exchange for gifts from lobbyist Jack Abramoff.
The award of the license was one of a series of acts that Ney said he performed for Abramoff in exchange for campaign contributions, expensive meals, luxury travel and sports tickets. Ney agreed this month to plead guilty to corruption charges and is set to enter his plea Oct. 13.
The license to install antennas for cellular and wireless telephones in House office buildings was awarded in 2002 to MobileAccess, formerly known as Foxcom Wireless, which was based in Israel. The company, now based in Vienna, Va., later paid Abramoff $280,000 in lobbying fees and donated $50,000 to a charity operated by Abramoff that paid for a golf junket to Scotland for Ney.
Rep. Zoe Lofgren (D-Calif.) said the license "has been suspended pending review," which could affect the wireless contract for the congressional visitors center now under construction.
"I think a company should not profit from corrupt actions," said Lofgren, who is on the House Administration Committee. "Obviously, what happened in awarding the contract was wrong, illegal, corrupt. The question is what role did the company have? Was the company a knowing participant?"
Salley Collins, a spokeswoman for the committee, said the review was underway but provided no more information. Congressional sources who spoke on condition on anonymity because the issue is under consideration said a review was prompted by the Abramoff corruption investigation.
MobileAccess employees "have cooperated fully in the investigation," said MobileAccess attorney Douglas A. Fellman, of Hogan & Hartson. "There has never been a suggestion of wrongdoing or improper conduct on the part of MobileAccess or its personnel, and after a very thorough investigation, that continues to be the case."
Abramoff and Neil G. Volz, who went to work for Abramoff as a lobbyist after serving as Ney's top aide, admitted in plea agreements this year that the wireless license was a favor for Abramoff in exchange for gifts.
Prosecutors said in charging papers that Ney took a variety of official actions for Foxcom, "including meeting with representatives of the client on or about May 10, 2001, leaking to Abramoff a copy of a letter from the client's competitor complaining about the selection process in or about September 2002, and issuing a license to Abramoff's client."
The decision had long-term implications for Foxcom competitor LGC Wireless Inc. of San Jose. The Senate also uses MobileAccess to remain consistent with the protocols of the House. LGC uses a different technology, though wireless and cellphone companies say both firms provide service that meets their standards.
An LGC official said yesterday that his company was pleased by the news of the House review.
"Given that it is public record that the House wireless job was awarded to Foxcom/MobileAccess due to Jack Abramoff's improper influence, and MobileAccess has subsequently been the recipient of follow-on business on the Hill in large part due to that initial award, we feel that it is appropriate that the license be reviewed," LGC spokesman John Spindler said. "Only in this way can competitiveness and fairness in any future government awards be ensured."
Cellphone coverage is a sore point with many members of Congress, who complain about dropped calls, particularly in the Capitol. It was a topic at the Administration Committee meeting.