RUS rescinds stimulus award to TierOne Converged Networks
The company was charged with security violations in April, though it won an award in August.
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A spokesman for the Rural Utilities Service confirmed this morning that the agency has rescinded a $19 million broadband stimulus award made on August 18 to TierOne Converged Networks, a Dallas-based ISP.
The move apparently was made after a news report questioned the award, noting that TierOne had been charged with alleged security violations in April. The RUS spokesman had no further comment this morning.
The award to TierOne was made as a combination of a loan and grant. It is unlikely that the company has actually been able to draw against any of those funds, as the award was made in the second funding round of the RUS broadband stimulus program. Organizations awarded funding more than six months ago in the first funding round only received authorization to draw against those funds within the last few weeks.
Privately held TierOne has pursued an aggressive strategy of network expansion through acquisition. The suit filed against the company by the Securities and Exchange Commission in April alleges, among other things, that TierOne made certain misrepresentations in materials used to solicit potential investors. These included failing to disclose CEO Kevin Mark Weaver’s disciplinary history with the Financial Industry Regulatory Authority or loans made to senior management.
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© 2012 Penton Media Inc.
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