(Washington, D.C.) – Citizens Against Government Waste (CAGW) expressed disappointment at today’s announcement that MCI was awarded another government contract, this time from the National Oceanic and Atmospheric Administration (NOAA), a day after the Securities and Exchange Commission (SEC) fined it $500 million for fraudulent practices.

“It is an outrage to learn that the federal bailout at taxpayer expense of MCI continues within 24 hours of the announcement of the scandal-ridden company's record-breaking fraud settlement with the SEC,” CAGW President Tom Schatz said.  “The stunningly ill-conceived and mis-timed move to award MCI a major satellite contract for NOAA deserves to go down in the record books for its breathtaking chutzpah.”

The seven-year contract calls for MCI to provide satellite data communications to weather stations worldwide.  This announcement also follows the awarding of a $45 million contract to MCI to handle a small cellular network for the Department of Defense in Iraq earlier this week, a particularly galling act since MCI isn’t even in the cellular business in the U.S.

“It is difficult to imagine a bigger slap in the face to the investors who lost $176 billion in retirement savings in the stock market due to MCI's fraudulent activities,” Schatz continued.  “What is the point of fining a company a record amount one day only to turn around and hand that same company a lucrative contract the very next day?  Not only does such an approach completely vitiate the impact of the SEC penalty, it also sends a cynical signal that there are no serious, lasting penalties for breaking the rules.” 

Companies such as Enron and Arthur Andersen, which have been found to conduct fraudulent business practices, have been suspended from contracting with the federal government as the law requires.  However, MCI has continued to receive contracts.

“Federal contracts paid for by taxpayers should go to companies that obey the law.  MCI should be debarred by the General Services Administration and other agencies so that it cannot benefit from more federal contracts,” Schatz concluded.  “The federal government is doing everything it can to reward contracts to a company guilty of record accounting fraud.  By doing so, it is putting taxpayer money in jeopardy.”

Citizens Against Government Waste is the nation's largest nonpartisan, nonprofit organization dedicated to eliminating waste, fraud, abuse, and mismanagement in government.  For more information, please visit www.cagw.org.