Oklahomans Against Bribery

Oklahomans Against Bribery


Frequently Asked Questions

If the bribery happened in 1989, isn't it too late to do anything about it?

NO. There is no statute of limitations on 'fraud on the court' (e.g. at the Oklahoma Corporation Commission or the Oklahoma Supreme Court).

Didn't AT&T buy Southwestern Bell after the bribery took place?  Is it really the fault of the present company?

Actually, it was Southwestern Bell that bought (its former parent company) AT&T in 2005 and changed its name to AT&T. Thus Southwestern Bell (now called AT&T) committed the fraud.  It is still in existance (as AT&T) and is responsible for righting this wrong.

AT&T says the bribed order was only worth $30 million.  The applicants say it is worth $16+ billion.  Who's right?

In the bribed order, the Oklahoma Corporation Commission found that Southwestern Bell was only earning about $9 million annually in excess revenues.  Roughly: $9 million x 3 years + interest = about $30 million.  The bribed order also allowed the company to keep that presumed $30 million rather than refund the excess revenues to ratepayers.  BUT an audit of Southwestern Bell a few years later showed the company had actually been earning about $120 million in excess revenues annually.  Again, roughly: $120 million x 3 years (and possibly longer) + interest (over 30 years!) = $16+ billion.

AT&T says it didn't "keep" the excess revenues.  It invested them in system upgrades.  Who's right?

Investing excess revenues in upgrades of company-owned equipment and company-owned infrastructure is still "keeping" them.    Frankly, it doesn't matter what AT&T did with the excess revenues; the money wasn't the company's in the first place.  The excess revenues should have been refunded to the ratepayers, as outlined in the Stipulation Order (see below).

What is the 'Stipulation Order'?

A stipulation is a legal agreement between two parties, similar to a contract.

In June 1987, just before the new lower federal corporate tax rates were to go into effect, Southwestern Bell signed a stipulation agreeing to refund any excess revenues if it were later determined that the pending change in tax rate would make the company's revenues higher than the rate of return allowed by the OCC. Later, the (bribed) PUD 260 order allowed Southwestern Bell to keep the excess revenues instead of enforcing the Stipulation Order and refunding them to ratepayers.  BUT that 1987 Stipulation Order is still in place. The Stipulation Order would allow today’s OCC to order refunds by Southwestern Bell (now AT&T) without such an order constituting “retroactive ratemaking” (which is prohibited).

Didn't the PUD 662 settlement in 1995 also settle the bribed PUD 260 case?

NO. PUD 662 was a general rate case for Southwestern Bell (examining all of the company's regulated activities) whereas the (bribed) PUD 260 case focused on the effects of the Tax Reform Act of 1986 on Southwestern Bell's revenues.  Although both were Southwestern Bell rate cases and they overlapped chronologically, PUD 260 (filed in 1986) and PUD 662 (filed in 1989) are not the same.  The 1995 PUD 662 settlement explicitly did NOT settle the bribed PUD 260 case, for which a final order was never issued.

Wasn't some of this covered by PBS several years ago?

YES. In 1997, the PBS investigative news show “Frontline” did two pieces detailing a different aspect of the bribery at the OCC (mostly surrounding illegal natural gas contracts and the Clinton White House’s squashing of indictments against ONG and ARKLA executives).  The shows don’t really get into the AT&T bribery case, but they’re still worth watching because some of the characters are the same and they give a good sense of everything that was going on at the time.

I have/used to have a Southwestern Bell telephone line in Oklahoma.  Would I be eligible for a refund?

It depends.  This case covers Southwestern Bell/AT&T landline (not wireless) customers in Oklahoma who had phone service after July 1, 1987.  Both residential and commercial customers are included.


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