MCI to settle overbilling claims

MCI will pay $27 million to settle claims that it overbilled government customers under the FTS 2001 contract, company officials said.

The money, the result of an agreement among MCI, the Justice Department and the General Services Administration, will reimburse unidentified agencies for excessive charges, according to a company statement.

"This agreement resolves a commercial billing dispute between MCI and GSA under the FTS 2001 contract," said an MCI spokesperson in a statement. "The dispute arose because the contract contained conflicting language regarding how certain charges should be assessed."

GSA officials were aware of the dispute in January when they chose not to bar the company from federal contracting, the statement reads. "MCI has kept GSA informed on the status of this matter," it states.

The situation is reminiscent of rival Sprint's settlement for $5.2 million last August. Sprint had been mistakenly billing customers at the market rate for services instead of the lower FTS 2001 rate, company officials said, and stopped as soon as the error was discovered.

MCI plans to emerge from bankruptcy later this month, according to sources. Officials finished filing documents with the Securities and Exchange Commission, including restated financial figures for 2001 and 2002, in mid-March. That was the final step it needed to take before emerging.

Featured

  • Cybersecurity

    DHS floats 'collective defense' model for cybersecurity

    Homeland Security Secretary Kirstjen Nielsen wants her department to have a more direct role in defending the private sector and critical infrastructure entities from cyberthreats.

  • Defense
    Defense Secretary James Mattis testifies at an April 12 hearing of the House Armed Services Committee.

    Mattis: Cloud deal not tailored for Amazon

    On Capitol Hill, Defense Secretary Jim Mattis sought to quell "rumors" that the Pentagon's planned single-award cloud acquisition was designed with Amazon Web Services in mind.

  • Census
    shutterstock image

    2020 Census to include citizenship question

    The Department of Commerce is breaking with recent practice and restoring a question about respondent citizenship last used in 1950, despite being urged not to by former Census directors and outside experts.

Stay Connected

FCW Update

Sign up for our newsletter.

I agree to this site's Privacy Policy.