BizJournals Portfolio

McCain 'Trailblazer' Burned

PREV 2 of 2

An IDT spokesperson declined to comment.

Jewett's lawyer, seeking to read the Haiti contracts at the Federal Communications Commission, discovered that the entire file had disappeared. The F.C.C. directed IDT and other carriers to refile their contracts. IDT's showed payments to the Turks & Caicos company.
 
Jewett's suit charges that IDT evaded the rules and kept competitors in the dark. Documents obtained via Freedom of Information Act requests this year also revealed that IDT failed to file contracts with dozens of other telecoms around the world.
 
The S.E.C. and I.R.S. are looking into IDT's tax returns for 2001, 2002, 2003, and 2004. Any discount or ill-gotten gain, such as the difference between 8.75 and 23 cents, is taxable.
 
In a quarterly S.E.C. report filed June 6, IDT's balance sheet shows $365 million "income taxes payable," meaning the sum is put aside for back taxes. The figure was zero last year.
 
All the executives below Courter involved with the Haiti deal are gone. The June report announced the "involuntary" departure of the chief legal officer.

Top-tier Republicans have also bailed out.
 
William Weld, former G.O.P. governor of Massachusetts, was head of corporate governance at IDT but resigned after the Jewett complaint was unsealed in July 2005.
 
IDT announced in October 2006 that its entire board would not seek reelection, including former congressman and vice presidential nominee Jack Kemp, former U.S. Ambassador to the U.N. Jeane Kirkpatrick, former Virginia Governor Jim Gilmore, former Minnesota Senator Rudy Boschwitz, and former Washington Senator Slade Gorton.

"Why do you put very powerful politicians on your board. Because you like them, you think they’re capable and they buy you protection," said Herbert Denton, president of the New York investment firm Providence Capital, which owned IDT stock. "Why do they leave at the same time? I speculate there’s something rotten in Denmark."


Comments

If you are commenting using a Facebook account, your profile information may be displayed with your comment depending on your privacy settings. By leaving the 'Post to Facebook' box selected, your comment will be published to your Facebook profile in addition to the space below.

Connect With Portfolio.com

Come on, like us—you know you want to.

Follow us and if you're an innovative entrepreneur, we'll return the favor.

Today's top stories, conversation starters, and the back nine business bites.

spotlight on

Slideshows

500 Startups Hits New York

Dave McClure's brainchild makes its way to New York and introduces East Coast money folks to some intriguing new companies. View Slideshow