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November 18, 2008
DA 08-2523
VIA CERTIFIED MAIL - RETURN RECEIPT REQUESTED
AND VIA FACSIMILE (203) 787-9031
Mr. Joseph E. Mello
c/o Michael O. Sheehan, Esq.
Sheehan & Reeve
139 Orange St., Suite 301
New Haven, CT 06510
Re: Notice of Debarment; File No. EB-08-IH-1615
Dear Mr. Mello:
Pursuant to section 54.8 of the rules of the Federal Communications
Commission (the "Commission"), by this Notice of Debarment you are
debarred from the schools and libraries universal service support
mechanism (or "E-Rate program") for a period of three years.
On September 4, 2008, the Enforcement Bureau (the "Bureau") sent you a
Notice of Suspension and Initiation of Debarment Proceedings (the "Notice
of Suspension"). That Notice of Suspension was published in the Federal
Register on September 17, 2008. The Notice of Suspension suspended you
from the schools and libraries universal service support mechanism and
described the basis for initiation of debarment proceedings against you,
the applicable debarment procedures, and the effect of debarment.
Pursuant to the Commission's rules, any opposition to your suspension or
its scope or to your proposed debarment or its scope had to be filed with
the Commission no later than thirty (30) calendar days from the earlier
date of your receipt of the Notice of Suspension or publication of the
Notice of Suspension in the Federal Register. The Commission did not
receive any such opposition.
As discussed in the Notice of Suspension, you pled guilty to mail fraud
and income tax fraud, in violation of 18 U.S.C. S: 1341, in connection
with your participation in the E-Rate program involving telecommunications
upgrade projects in four Connecticut school districts. You admitted to
participating in a scheme to defraud the E-Rate program whereby you
agreed, in your capacity as Vice President of Operations for Innovative
Network Solutions ("INS"), to accept invoices submitted by fictitious
companies for work allegedly performed in the Connecticut school
districts. As a result of your actions, INS made payments totaling
$608,505 on those fictitious invoices that were ultimately submitted to
the Universal Service Administrative Company as legitimately reimbursable
services under the E-Rate program. Such conduct constitutes the basis for
your debarment, and your conviction falls within the categories of causes
for debarment under section 54.8(c) of the Commission's rules. For the
foregoing reasons, you are hereby debarred for a period of three years
from the debarment date, i.e., the earlier date of your receipt of this
Notice of Debarment or its publication date in the Federal Register.
Debarment excludes you, for the debarment period, from 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."
Sincerely,
Hillary S. DeNigro
Chief
Investigations and Hearings Division
Enforcement Bureau
cc: Calvin B. Kurimai, Esq., Assistant United States Attorney, Department
of Justice
(via e-mail)
Kristy Carroll, Esq., Universal Service Administrative Company (via
e-mail)
September 4, 2008
DA 08-2041
VIA CERTIFIED MAIL
RETURN RECEIPT REQUESTED AND E-MAIL
Mr. Joseph E. Mello
c/o Michael O. Sheehan, Esq.
Sheehan & Reeve
139 Orange St., Suite 301
New Haven, CT 06510
Re: Notice of Suspension and Initiation of Debarment Proceedings,
File No. EB-08-IH-1615
Dear Mr. Mello:
The Federal Communications Commission ("FCC" or "Commission") has received
notice of your conviction of mail fraud, in violation of 18 U.S.C. S:
1341, and subscribing a false tax return, in violation of 26 U.S.C. S:
7206(1), in connection with your participation in the schools and
libraries universal service support mechanism ("E-Rate program").
Consequently, pursuant to 47 C.F.R. S: 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 we are
commencing debarment proceedings against you.
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. You pled guilty
to mail fraud and income tax fraud in connection with your participation
in the E-Rate program involving telecommunications upgrade projects in
four Connecticut school districts. While employed as Vice President of
Operations for Innovative Network Solutions ("INS"), a first-tier
subcontractor of Southwestern Bell Communications ("SBC") for performing
E-Rate funded telecommunications upgrades, you and former SBC employees
Richard E. Brown and Keith J. Madeiros participated in a scheme to defraud
the E-Rate program. In your position at INS, you agreed to accept invoices
submitted by fictitious companies created by Mr. Madeiros and Mr. Brown
for work allegedly performed in the Connecticut school districts. INS made
payments totaling $608,505 on those fictitious invoices and then passed
the costs on to SBC as legitimately reimbursable services under the E-Rate
program.
Pursuant to section 54.8(a)(4) of the Commission's rules, 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. Your suspension becomes effective upon the earlier of
your receipt of this letter or publication of notice in the Federal
Register.
Suspension is immediate pending the Bureau's final debarment
determination. In accordance with the Commission's debarment rules, 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. Such requests, however, will not ordinarily be
granted. The Bureau may reverse or limit the scope of suspension only upon
a finding of extraordinary circumstances. Absent extraordinary
circumstances, the Bureau will decide any request for reversal or
modification of suspension within 90 days of its receipt of such request.
II. Initiation of Debarment Proceedings
Your guilty plea to criminal conduct in connection with the E-Rate
program, in addition to serving as a basis for immediate suspension from
the program, also serves as a basis for the initiation of debarment
proceedings against you. Your conviction falls within the categories of
causes for debarment defined in section 54.8(c) of the Commission's rules.
Therefore, pursuant to section 54.8(a)(4) of the Commission's rules, your
conviction requires the Bureau to commence debarment proceedings against
you.
As with your suspension, 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. Absent extraordinary circumstances,
the Bureau will debar you. 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. If the Bureau decides to debar you, its decision will become
effective upon the earlier of your receipt of a debarment notice or
publication of the decision in the Federal Register.
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.
The Bureau may, if necessary to protect the public interest, extend the
debarment period.
Please direct any response, if by messenger or hand delivery, to Marlene
H. Dortch, Secretary, Federal Communications Commission, 236 Massachusetts
Avenue, N.E., Suite 110, Washington, D.C. 20002, to the attention of
Rebekah Bina, Attorney Advisor, Investigations and Hearings Division,
Enforcement Bureau, Room 4-C330, with a copy to Vickie Robinson, Assistant
Chief, Investigations and Hearings Division, Enforcement Bureau, Room
4-C330, Federal Communications Commission. If sent by commercial overnight
mail (other than U.S. Postal Service Express Mail and Priority Mail), the
response should be sent to the Federal Communications Commission, 9300
East Hampton Drive, Capitol Heights, Maryland 20743. If sent by
first-class, Express, or Priority mail, the response should be sent to
Rebekah Bina, Attorney Advisor, Investigations and Hearings Division,
Enforcement Bureau, Federal Communications Commission, 445 12th Street,
S.W., Room 4-C330, Washington, DC, 20554, with a copy to Vickie Robinson,
Assistant Chief, Investigations and Hearings Division, Enforcement Bureau,
Federal Communications Commission, 445 12th Street, S.W., Room 4-C330,
Washington, DC, 20554. You shall also transmit a copy of the response via
email to Rebekah.Bina@fcc.gov and to Vickie.Robinson@fcc.gov.
If you have any questions, please contact Ms. Bina via mail, by telephone
at (202) 418-7931 or by e-mail at Rebekah.Bina@fcc.gov. If Ms. Bina is
unavailable, you may
contact Ms. Vickie Robinson, Assistant Chief, Investigations and Hearings
Division, by telephone at (202) 418-1420 and by e-mail at
Vickie.Robinson@fcc.gov.
Sincerely yours,
Hillary S. DeNigro
Chief
Investigations and Hearings Division
Enforcement Bureau
cc: Calvin B. Kurimai, Esq., Assistant United States Attorney
Kristy Carroll, Esq., Universal Service Administrative Company (via
e-mail)
See 47 C.F.R. S:S: 0.111(a), 54.8.
Letter from Hillary S. DeNigro, Chief, Investigations and Hearings
Division, Enforcement Bureau, Federal Communications Commission, to Mr.
Joseph Mello, Notice of Suspension and Initiation of Debarment
Proceedings, DA 08-2041 (Inv. & Hearings Div., Enf. Bur., rel. Sept. 4,
2008) (Attachment 1).
73 Fed. Reg. 53868 (Sept. 17, 2008).
See Notice of Suspension, 73 Fed. Reg. at 53869-70.
See 47 C.F.R. S:S: 54.8(e)(3) and (4). That date occurred no later than
October 17, 2008. See supra note 3.
73 Fed. Reg. at 53869.
Id.
Id.
47 C.F.R. S: 54.8(c).
See 47 C.F.R S:54.8(g). See also Notice of Suspension, 73 Fed. Reg. at
53870.
See 47 C.F.R. S:S: 54.8(a)(1), 54.8(a)(5), 54.8(d); Notice of Suspension,
73 Fed. Reg. at 53869.
Any further reference in this letter to "your conviction" refers to your
guilty plea and subsequent conviction of one count of mail fraud and one
count of subscribing a false tax Return. United States v. Joseph E. Mello,
Criminal Docket No. 3:07-CR-00224 (RNC-1), Plea Agreement (D.Conn. filed
and entered Oct. 9, 2007) ("Mello Plea Agreement"); United States v.
Joseph E. Mello, 3:07-CR-00224 (RNC-1), Judgment (D.Conn. filed June 26,
2008 and entered June 30, 2008) ("Mello Judgment"). See also United States
v. Joseph E. Mello, Criminal Docket No. 3:07-CR-00224 (RNC-1), Information
(D. Conn. filed and entered Oct. 9, 2007) ("Mello Information").
47 C.F.R. S: 54.8; 47 C.F.R. S: 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 of the 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;
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 section 54.521 of
the universal service debarment rules as section 54.8 and amending
subsections (a)(1), (5), (c), (d), (e)(2)(i), (3), (e)(4), and (g)).
Second Report and Order, 18 FCC Rcd at 9225, P: 66. 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 C.F.R. S: 54.8(a)(6).
See Mello Information at 2; Mello Plea Agreement at 1-2, 5; Mello Judgment
at 1.
Mello Information at 3. The Bureau has debarred Richard E. Brown and Keith
Madeiros from the E-Rate Program. See Letter from Hillary S. DeNigro,
Chief, Investigations and Hearings Division, Enforcement Bureau, to
Richard E. Brown, Notice of Debarment, 22 FCC Rcd 20569 (Inv. & Hearings
Div., Enf. Bur. 2007); Letter from Hillary S. DeNigro, Chief,
Investigations and Hearings Division, Enforcement Bureau, to Keith J.
Madeiros, Notice of Debarment, 23 FCC Rcd 7959 (Inv. & Hearings Div., Enf.
Bur. 2008).
Mello Information at 2-4. See also Department of Justice, Press Release
(Oct. 9, 2007)(available at
http://www.usdoj.gov/usao/ct/Press2007/20071009.html)(last accessed Feb.
5, 2008)("DOJ October 9 Press Release").
Mello Information at 4.
47 C.F.R. S: 54.8(a)(4). See Second Report and Order, 18 FCC Rcd at
9225-27, P:P: 67-74.
Second Report and Order, 18 FCC Rcd at 9225, P: 67; 47 U.S.C. S: 254; 47
C.F.R S:S: 54.502-54.503; 47 C.F.R. S: 54.521(a)(4).
Second Report and Order, 18 FCC Rcd at 9226, P: 69; 47 C.F.R. S:
54.8(e)(1).
47 C.F.R. S: 54.8(e)(4).
Id.
47 C.F.R. S: 54.8(e)(5).
See Second Report and Order, 18 FCC Rcd at 9226, P: 70; 47 C.F.R. S:S:
54.8(e)(5), 54.8(f).
"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. S: 54.8(c). Such 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
mechanism." 47 C.F.R. S: 54.8(a)(1).
See Second Report and Order, 18 FCC Rcd at 9226, P: 70; 47 C.F.R. S:
54.8(e)(3).
Second Report and Order, 18 FCC Rcd at 9227, P: 74.
See id., 18 FCC Rcd at 9226, P: 70; 47 C.F.R. S: 54.8(e)(5).
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 C.F.R. S: 54.8(f).
Second Report and Order, 18 FCC Rcd at 9225, P: 67; 47 C.F.R. S:S:
54.8(d), 54.8(g).
Id.
Mr. Joseph Mello
November 18, 2008
Page 2 of 2
Federal Communications Commission
Enforcement Bureau
Investigations and Hearings Division
445 12th Street, SW, Suite 4-C330
Washington, D.C. 20554
Mr. Joseph Mello
September 4, 2008
Page 5 of 5
Attachment 1
Federal Communications Commission
Enforcement Bureau
Investigations and Hearings Division
445 12th Street, SW, Suite 4-C330
Washington, D.C. 20554