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AT&T hit with $23 million fine after bribing lawmakers

Officials with AT&T say they will stop bribing lawmakers after the company was hit with a substantial fine by federal prosecutors last week.

The fine is part of a deferred prosecution agreement with the U.S. Department of Justice (DOJ) in which AT&T’s subsidiary in Illinois will pay $23 million following a probe into alleged misconduct involving Michael J. Madigan, a former state politician.

According to the DOJ, a lengthy criminal investigation revealed AT&T executives bribed individuals close to Madigan in order to influence his vote concerning certain legislation of interest to the phone and Internet company.

AT&T paid tens of thousands of dollars through an intermediary that the DOJ identified as a lobbyist. Though the payment went through, the person identified as an ally of Madigan performed no actual work for the company, and no one at AT&T ever followed up to see if the work would be performed.

Rather than criminally charge AT&T, prosecutors said they would defer legal action against the company as long as they agreed to pay the fine and cooperate with its investigation against Madigan and others who are accused of wrongdoing.

It was not clear if anyone at AT&T’s Illinois subsidiary was dismissed or otherwise discipline as part of the scheme. Last week, a spokesperson for the company said AT&T would not try to bribe politicians in the future.

“We hold ourselves and our contractors to the highest ethical standards,” the AT&T spokesperson said in a statement. “We are committed to ensuring that this never happens again.”

AT&T stopped short of saying it would not spend money on lobbying initiatives involving local, state and federal politicians — only that it wouldn’t try to make direct payments for votes on legislation. According to the website Open Secrets, AT&T spent at least $11.48 million on federal lobbying efforts in 2021; so far, the company has spent at least $6.24 million on lobbying efforts this year.

The actual amount AT&T has spent on overall lobbying efforts is likely higher, because Open Secrets only collects data on federal lobbying from the Senate Office of Public Records. The website doesn’t include information on local or state lobbying, or how much is spent on those activities.

A statement on the AT&T website said its lobbying efforts are connected to various initiatives and include direct donations to politicians and political action committees, memberships in trade organizations and other corporate contributions.

“We strive to bring our customers the innovation they demand, provide shareholders value on their investment and be a responsible corporate citizen,” a spokesperson for AT&T said in a political engagement report published last year. “A critical component of these efforts is actively participating in the political process.”

The company said it has “strict internal policies, processes and compliance measures to ensure adherence to legal and regulatory requirements,” and that there exists an internal system where potential contributions to politicians and political committees must be vetted and approved before money is exchanged.

“Every political contribution request is legally reviewed, and all contributions are approved by management in strict compliance with our policy and procedures for contributions,” an AT&T official said last year.

It was not clear from AT&T’s statements last year and this week whether the contribution made to Madigan through an intermediary was approved by the company through that system. Paul La Schiazza, an AT&T executive in charge of the company’s Illinois territory, was criminally charged in connection with the bribery scheme last week.

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About the Author:

Matthew Keys

Matthew Keys is a nationally-recognized, award-winning journalist who has covered the business of media, technology, radio and television for more than 10 years. He is the publisher of The Desk and contributes to Know Techie, Digital Content Next and StreamTV Insider. He previously worked for Thomson Reuters, the Walt Disney Company, McNaughton Newspapers and Tribune Broadcasting.
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