Telecommunications carrier Qwest Communications International is
under suspicion of striking secret deals with competitors who
agreed not to oppose Qwest's rapid expansion, according to the Wall
Street Journal.
An example of such a deal would be where Qwest offered a smaller
carrier discounts for using Qwest's infrastructure, on the
understanding that the carrier would not oppose Qwest's submission
to operate long-distance services in that market, according to the
WSJ.
The 1996 Telecommunications Act dictates that regional phone
carriers in the US, such as Qwest, provide non-discriminatory
access to their services, so that an agreement struck with one
local provider should be freely available to all, the
WSJ
said.
According to the
WSJ, several US states have been
investigating these allegations for up to a year. Qwest, fearing a
series of separate state hearings, has now asked the US Federal
Communications Commission (FCC) to intervene and rule on whether it
violated any regulations. The FCC has not yet decided whether to
step in, the
WSJ said.
The states conducting investigations include Minnesota, Arizona,
Oregon, New Mexico, Colorado and Utah, according to the
WSJ.
The allegations against Qwest add to its legal problems. The
company is already facing a probe by the US Securities and Exchange
Commission (SEC) into whether it misleadingly inflated revenues in
2000 and 2001.
Earlier this month the SEC began a formal investigation into
accounting procedures at Qwest, covering how Qwest recognised
revenue and accounted for sales of optical capacity and matters
relating to its sale of telecommunication equipment to customers
who either purchased Internet services from Qwest, or who received
financing from the company.