October 4, 2007 10:31 AM

GAO Says FCC Leaking Inside Info to Lobbyists

Check this out from the Los Angeles Times today:

"From giant phone companies to small consumer advocates, the Federal Communications Commission is supposed to treat every group equally. But congressional investigators have found some companies and trade groups have received special treatment. FCC officials tipped them off to confidential information about when regulators planned to vote on important issues -- a clear violation of agency rules that provided an unfair lobbying advantage, according to a report by the Government Accountability Office released today. Other interested parties -- generally consumer and public-interest groups -- did not get such favorable treatment, the report said...With oversight of many aspects of telephone, TV, radio and Internet services, the FCC has a major effect on people's lives. Its decisions also can affect entire sectors of the telecommunications industry. Privileged information, leaked in violation of FCC rules, could give some companies and organizations advantages when trying to sway the commission, the GAO said."

This revelation comes less than a year after the Wall Street Journal reported that K Street lobbying firms have created an entire cottage industry to dig out insider information from Washington. Corporate interests are "hiring lobbyists -- not to influence government, but to tell them what it's going to do," the report said, adding that:

"Several lobbying firms are ramping up their "political-intelligence" units and charging hedge funds between $5,000 and $20,000 a month for tips and predictions...the SEC is trying to resolve is whether the passing of market-sensitive information by lobbyists to investors could violate insider-trading law...lobbyists only have to disclose their work for clients seeking to influence government, while hedge funds and other clients seeking market-beating tips can stay in the shadows. Increasingly, lobbyists acting as advocates for a company on an issue may also have a client looking to trade on information about the same issue...The growth in the market for political intelligence in the last 18 months has been dramatic."

Coincidence that the FCC is leaking inside information to corporate interests at the same time corporate interests are ramping up their efforts to use Washington lobbyists in a shady scheme to gather insider information? I think not.