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Verizon Settles with U.S. Government

The United States Department of Justice has reached a settlement with telecommunication vendor Verizon over alleged overbilling.

The overcharging allegations are specifically against Verizon and its MCI Communication subsidiary for the FTS2001 contracts with the General Services Administration (GSA). Those contracts include voice and data communications services across the U.S. government.

The settlement will see Verizon paying the U.S. government the sum of $93,525,410.96. The Department of Justice found that false claims had been submitted by Verizon and MCI for items that should not have been paid, under the terms of the GSA contracts.

"A government contract is not a blank check,” said U.S. Attorney Ronald C. Machen Jr. in a statement. "Contractors who overbill the government will be aggressively pursued and required to make the taxpayers whole. This $93 million recovery should make contractors realize that we are firmly committed to ensuring the integrity of corporate billing practices with respect to government programs."

The Department of Justice is also using the settlement to highlight the GSA's Office of the Inspector General (OIG) and its audit programs to ensure that the government is not overbilled for services.

"We will protect taxpayers against those who seek to charge more than they deserve." Tony West, Assistant Attorney General for the Civil Division of the Department of Justice said in a statement.

Concerns over the GSA contracts with MCI go back to at least 2003 in the wake of MCI's accounting scandal and bankruptcy filing. Verizon acquired MCI IN 2006, in a deal valued at $8.4 billion.

Sean Michael Kerner is a senior editor at InternetNews.com, the news service of Internet.com, the network for technology professionals.