IRREGULATORS vs. FCC: Exposing One of the Largest Accounting Scandals in American History.

  • Created the Digital Divide. In almost every state, Verizon et al. had agreements, which started in the 1990’s, to upgrade their entire state territory; rural, urban and suburban areas were to be done equally. In fact, in most states, the state laws were changed to charge local phone customers rate increases for this work. Instead, the companies left much of the rural areas to deteriorate claiming they were ‘unprofitable’; even many of the inner-cities weren’t upgraded, especially in low income areas. But this was just part of this artificial financial shell game.
  • Customers were Overcharged Billions of Dollars for Wireless. This is not chump change. With this cross-subsidy scheme, local phone customers in most states were illegally charged billions to pay for the build outs of fiber optic networks that are used for wireless. On top of this, the Wireless service has been paying a fraction of the market prices and expenses that it should be paying for using the utility networks.
  • Tax Benefits from Artificial Losses. With local wired networks paying the majority of expenses — (even though the costs were not incurred to offer the service), the companies lost billions a year, and these were used by the companies for tax benefits.
  • Shut Off the Copper; Dismantle the State Utilities. Making the local service networks appear unprofitable is now used as part of the claim that the companies should be allowed to ‘shut off the copper’ and force-march customers onto wireless (because it makes them more money). And to help AT&T et al., the FCC’s current plan is to dismantle the utilities, handing them over to the wireless company as private property for private use. This is done in conjunction with ALEC, the American Legislative Exchange Council, who creates model legislation (paid for by AT&T et al.) to work in concert with the FCC’s plan.
  • The Verizon NY 2017 Annual Report was published June 2018 — and supplies the full financials of the state-based telecommunications utility.
  • In July 2018 there was a settlement of Verizon NY with the NY Public Service Commission which ended an investigation that started in 2015. Estimated at $300-$500 million, and based in part on our work, Verizon NY is required to upgrade 32,000 lines to fiber optics and maintain the existing copper networks.
  • From 2005–2017, local phone customers were overcharged an estimated $2,700.00 per line due to rate increases using artificial losses and cross-subsidized expenses.
  • Verizon Wireless diverted the utility construction budgets to do the fiber to the cell sites. From 2010–2012, Verizon Wireless appears to have underpaid Verizon New York, the state utility, $2.8 billion for construction.
  • Verizon NY Local Service was charged $1.8 billion for Corporate Operations expense, 62% of the total, in just 2017, due the freeze. These are the expenses for the corporate jets, executive pay and lawyers.
  • Verizon New York shows losses of over $2 billion a year for almost a decade, with billions in tax benefits.



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bruce kushnick

bruce kushnick

New Networks Institute,Executive Director, & Founding Member, IRREGULATORS; Telecom analyst for 38 years, and I have been playing the piano for 63 years.