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PSC Hiring Accountant to Look at Innovative Finances

May 13, 2005 – The Public Services Commission Friday voted to hire a forensic accountant to gauge the financial viability of Innovative Telephone, also known as Vitelco, as the company wades through a legal battle with the Rural Telephone Finance Corporation.
Since June of last year – when the RTFC first filed its $500 million suit against the parent company (Innovative Communications Corp.) for defaulting on its loan agreement – the telephone company had been called on to give periodic reports of its financial viability to the commission.
On Friday, PSC Chairman Valencio Jackson said the commission had not received a report from Innovative Telephone or RTFC prior to Friday's hearing. But Vitelco's attorney Jada Finch-Sheen told the commission members that a report had been mailed to them Tuesday.
PSC member Jerris Browne said he was tired of the untimely reports and moved for the commission to hire a forensic accountant to properly assess the utility's financial condition.
"What is the PSC doing to protect the viability of our telephone company?" PSC member Verne David asked.
Jackson said by hiring the forensic accountant the commission would be better able to understand the true condition of the utility.
Finch-Sheen told the commission she didn't see the need to hire the forensic accountant, which will be a cost to the phone company, when Innovative Telephone could readily provide the PSC with any information they needed.
Jackson said the forensic accountant would be an expert in telecommunication matters and would be able to analyze information for them, which many of the commissioners would not be able to do because of their varying backgrounds.
The motion was approved with a 3-1 vote with Desmond Maynard and Alecia Wells abstaining. Browne, David and Jackson voted in the affirmative. Alric Simmonds voted against.
Finch-Sheen also informed the commission that the case between Innovative and the RTFC would now be heard at the St. Thomas District Court, and a hearing was scheduled Sept. 23 before District Judge Curtis Gomez. The case was originally filed in Virginia last year before moving to the District Court of St. Croix in October 2004.
PSC Legal Counsel Frederick Watts said it seemed to him that the date would be uncertain because of all the arguments.
In March, RTFC filed a motion in District Court asking Gomez to recuse himself from presiding over the case for two independent reasons. For one, RTFC stated that Gomez's wife, attorney Simone R.D. Francis, previously served as an attorney for the RTFC for the same case and received client confidences and work product material throughout her representation.
"The fact that the judge’s spouse has now ceased to act as a lawyer in that proceeding does not lessen the strong basis for a third party to reasonably question the Court’s impartiality, particularly where, as here, the judge’s spouse was terminated by one of the parties as a result of issues relevant to the case and to this motion," the motion stated.
The second reason given in the motion is the apparent impropriety "given the fact that former V.I. Senator Holland L. Redfield, II, who reportedly played a central role in the nomination and confirmation to the bench of the judge assigned to this case, is also a key part of the management team of the defendant in this case, Innovative Communication Corp. ("ICC"), and the Virgin Islands Telephone Company ("Vitelco")."
The motion also quoted Gomez from transcripts of his investiture ceremony in District Court openly thanking Redfield for his role in recommending him to the White House.
Jonathan Siegfried, legal counsel for RTFC, said Friday that he had not yet been notified of Gomez's intentions as to whether he would preside over the case or recuse himself.
"If the case remains with Judge Gomez, then there is presently scheduled a motion for summary judgment to be heard on Sept. 23," Siegfried said. "That's the present schedule, but that's if Gomez continues with this case and doesn't change the schedule."
In other action, the PSC voted to postpone its assessments of the telephone company until further clarification of the charges that were made.
The commission warned Innovative to submit its quarterly reports of how the money received from the Universal Services Fund was being used in the territory and charged them to apply for certification before Aug. 1 of this year and not wait until days before the deadline for sending its application to the Federal Communications Commission, as was done in previous years.
Several commission members also complained of poor service they and their friends were receiving, including the two recently appointed Senate members Sens. Roosevelt David and Juan Figueroa-Serville.
PSC members present at the hearing were: Browne, David, Jackson, Maynard, Simmonds, Wells and non-voting members David and Figueroa-Serville.
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