A US House panel is investigating whether the country’s telecoms regulator rushed through its approval of LightSquared’s application to operate a wireless network in early 2011, according to a report from Dow Jones Newswires.
LightSquared (Reston, USA) was subsequently stopped from providing services owing to concerns that its technology interferes with GPS signals transmitted by the airline industry, among others.
The company filed for Chapter 11 bankruptcy protection in May and is fast running out of cash while its network goes unused.
On Friday last week, the US House Subcommittee on Oversight and Investigations questioned a representative of the Federal Communications Commission on the matter.
According to Dow Jones, panel chairman Cliff Stearns asked the FCC’s Mindel de la Torre if it is the regulator’s job to maintain “the rules of the road”, having drawn a comparison between GPS interference and a car crossing a lane of traffic.
The FCC revoked LightSquared’s concession in February, shortly after Congress had approved the licensing of more airwaves for use with wireless technologies.
Its decision to suspend the license followed the publication of a report by the National Telecommunications and Information Administration, which determined that LightSquared’s network might interfere with GPS systems.
LightSquared’s original aim was to provide wireless services based on 4G technology to around 260 million Americans by 2015.
The company is owned by Harbinger Capital Partners (New York, USA), a private-equity group run by Phil Falcone, who has been attacked by various lenders for not trying to sell LightSquared since its problems began.
Falcone is also being sued by the Securities and Exchange Commission for numerous violations, including misappropriating client money and manipulating bond prices.