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Federal Communications Commission
Washington, D.C. 20554
August 21, 2003
VIA CERTIFIED MAIL
RETURN RECEIPT REQUESTED
Mr. John Angelides
Chief Executive Officer
Connect2 Internet Networks, Inc.
26 Bay Street
Staten Island, NY 10301
Re: Notice of Suspension and of Proposed Debarment,
File No. EB-03-IHD-0376.
Dear Mr. Angelides:
The Federal Communications Commission (``FCC'' or
``Commission'') has received notice of your May 22, 2003
conviction under 18 U.S.C. § 371 for conspiracy to commit an
offense against or to defraud the United States. Specifically,
you were convicted of conspiracy to violate the following laws of
the United States: (1) 18 U.S.C. § 287 (false, fictitious, and
fraudulent claims); (2) 18 U.S.C. § 1001 (false statements and
entries generally); and (3) 18 U.S.C. § 1343 (fraud by wire,
radio, or television).1 Consequently, pursuant to 47 C.F.R.
§ 54.521, this letter constitutes official notice of your
suspension from the schools and libraries universal service
support mechanism. In addition, the Enforcement Bureau
(``Bureau'') hereby notifies you that we are commencing debarment
proceedings against you.2
I. Notice of Suspension
Pursuant to section 54.521(a)(4) of the Commission's rules,3
your conviction requires the Bureau to suspend you from
participating in any activities associated with or related to the
schools and libraries fund mechanism, including the receipt of
funds or discounted services through the schools and libraries
fund mechanism, or consulting with, assisting, or advising
applicants or service providers regarding the schools and
libraries support mechanism.4 Your suspension becomes effective
upon the earlier of your receipt of this letter or publication of
notice in the Federal Register.5
Suspension is immediate pending the Bureau's final debarment
determination. You may contest this suspension or the scope of
this suspension by filing arguments in opposition to the
suspension, with any relevant documentation. Your request must
be received within 30 days after you receive this letter or after
notice is published in the Federal Register, whichever comes
first.6 Such requests, however, will not ordinarily be granted.7
The Bureau may reverse or limit the scope of suspension only upon
a finding of extraordinary circumstances.8 Absent extraordinary
circumstances, the Bureau will decide any request for reversal or
modification of suspension within 90 days of its receipt of such
II. Notice of Proposed Debarment
II.A. Reasons for and Cause of Debarment
The Commission's rules establish 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.10 On May 22, 2003, you admitted,
among other things, to selling eligible services to certain
participating schools through your company Connect2, imposing 100
percent of the cost on the E-Rate program. You admitted to each
of the following acts: (1) falsely representing to the schools
that they could participate in the program at no cost to them;
(2) falsely representing to fund administrators and Government
investigators that the schools would pay or had paid their
unsubsidized share; and (3) falsifying documents, as well as
attempting to persuade school administrators not to reveal
evidence to Government investigators, in order to conceal the
scheme.11 These actions constitute the conduct or transactions
upon which this debarment proceeding is based.12
Moreover, your conviction on the basis of these acts falls
within the categories of causes for debarment defined in section
54.521(c) of the Commission's rules.13 Therefore, pursuant to
section 54.521(a)(4) of the Commission's rules, your conviction
requires the Bureau to commence debarment proceedings against
II.B. Debarment Procedures
You may contest debarment or the scope of the proposed
debarment by filing arguments and any relevant documentation
within 30 calendar days of the earlier of the receipt of this
letter or of publication in the Federal Register.14 Absent
extraordinary circumstances, the Bureau will debar you.15 Within
90 days of receipt of any opposition to your suspension and
proposed debarment, the Bureau, in the absence of extraordinary
circumstances, will provide you with notice of its decision to
debar.16 If the Bureau decides to debar you, its decision will
become effective upon the earlier of your receipt of a debarment
notice or the publication of its decision in the Federal
II.C. Effect of Debarment
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 at
least three years from the date of debarment.18 The Bureau may,
if necessary to protect the public interest, extend the debarment
Please direct any responses to the following address:
Federal Communications Commission
Investigations and Hearings Division
445 12th Street, S.W.
Washington, D.C. 20554
If you submit your response via hand-delivery or non-United
States Postal Service delivery (e.g., Federal Express, DHL,
etc.), please send your response to Ms. Lee at the following
Federal Communications Commission
9300 East Hampton Drive
Capitol Heights, MD 20743
If you have any questions, please contact Ms. Lee via mail, by
telephone at (202) 418-1420 or
by e-mail at email@example.com. If Ms. Lee is unavailable, you
may contact William Davenport by telephone at (202) 418-1420 and
by e-mail at firstname.lastname@example.org.
Maureen F. Del Duca
Investigations and Hearings
cc: Mark S. Cohen, Cohen & Gressler, LLP
Kristy Carroll, USAC
1 Any further reference in this letter to ``your
conviction'' refers to your May 22, 2003 guilty plea and
conviction on this count based on your fraudulent scheme to
obtain schools and libraries E-Rate program funds. See
United States v. Angelides, Docket No. 1:03cr635, Felony
Information (S.D.N.Y. filed May 20, 2003) (``Angelides
2 47 C.F.R. § 54.521; 47 C.F.R. § 0.111(a)(14) (delegating
to the Enforcement Bureau authority to resolve universal
service suspension and debarment proceedings pursuant to 47
C.F.R. § 54.521).
3 47 C.F.R. § 54.521(a)(4). See Schools and Libraries
Universal Service Support Mechanism, Second Report and Order
and Further Notice of Proposed Rulemaking, 18 FCC Rcd 9202,
9225-9227, ¶¶ 67-74 (2003) (``Second Report and Order'').
4 Second Report and Order, 18 FCC Rcd at 9225, ¶ 67; 47
U.S.C. § 254; 47 C.F.R §§ 54.502-54.503; 47 C.F.R.
5 Second Report and Order, 18 FCC Rcd at 9226, ¶ 69; 47
C.F.R. § 54.521(e)(1).
6 Second Report and Order, 18 FCC Rcd at 9226, ¶ 70; 47
C.F.R. § 54.521(e)(4).
7 Second Report and Order, 18 FCC Rcd at 9226, ¶ 70.
8 47 C.F.R. § 54.521(f).
9 Second Report and Order, 18 FCC Rcd at 9226, ¶ 70; 47
C.F.R. §§ 54.521(e)(5), 54.521(f).
10Second Report and Order, 18 FCC Rcd at 9225, ¶ 66.
11See Angelides Felony Information at 3-11.
12Second Report and Order, 18 FCC Rcd at 9226, ¶ 70; 47
C.F.R. § 54.521(e)(2)(i).
13``Causes for suspension and debarment are the 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.'' 47 C.F.R. § 54.521(c). Such
activities ``include 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 schools and
libraries support mechanism described in this section ([47
C.F. R.] § 54.500 et seq.).'' 47 C.F.R. § 54.521(a)(1).
14Second Report and Order, 18 FCC Rcd at 9226, ¶ 70; 47
C.F.R. §§ 54.521(e)(2)(i), 54.521(e)(3).
15Second Report and Order, 18 FCC Rcd at 9227, ¶ 74.
16 Second Report and Order, 18 FCC Rcd at 9226, ¶ 70; 47
C.F.R. § 54.521(e)(5).
17Id. 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 C.F.R. § 54.521(f).
18Second Report and Order, 18 FCC Rcd at 9225, ¶ 67; 47
C.F.R. §§ 54.521(d), 54.521(g).