August 13, 2001 -- The Competitive Telecommunications Association (CompTel) urged the Federal Communications Commission (FCC) to impose forfeitures on Verizon Communications, Inc. for failing to comply with the Commission's Bell Atlantic/GTE Merger Order and Conditions. Under the terms of the Merger Order, Verizon is required to retain an independent auditor to evaluate Verizon's compliance with the Merger Conditions. Two recent audits revealed significant instances of noncompliance with the Merger Conditions, resulting in harm to competitive telecommunications carriers.

CompTel, while calling attention to numerous instances of noncompliance, requested an expedited investigation into those areas that were particularly devastating to competitors seeking to deliver advanced services to consumers. CompTel noted specifically that an audit of Verizon's separate advanced services affiliate revealed that Verizon failed to invoice the affiliate for line-sharing during the period July 2000 through April 2001, and provided the affiliate access to operations support systems (OSS) that were not made available to other telecommunications carriers.

"These audits clearly demonstrate that Verizon is discriminating to the advantage of its advanced services affiliate, which constitutes a violation of the Bell Atlantic/GTE Merger Conditions," said H. Russell Frisby, Jr., president of CompTel. "Enforcement, with strong penalties, will send the message that no violation will be tolerated, providing competitors 'an increased measure of confidence that the company will not engage in discrimination,' as envisioned by the Merger Order."

The audit reports also found that:

- Verizon did not provide competing carriers timely and accurate bill credits for unbundled network elements and resold telecommunications services, effectively resulting in a no-interest loan to Verizon.

· Verizon consistently miscalculated performance measures, failed to report performance measures, failed to capture the underlying data needed to calculate performance measures, or unilaterally revised the business rules associated with certain performance measures, making it impossible for regulators and competitive carriers to detect discrimination by Verizon.

CompTel urged the Commission to impose appropriate sanctions for any violations uncovered by the audit reports to deter future violations, and called for a full investigation into all potential instances of noncompliance with the Merger Order and Conditions and underlying FCC rules.