Mci Diverted Sensitive Calls, At&T Charges

Long-distance giant MCI avoided paying access fees to local phone companies by diverting calls to Canada, including calls placed by the State Department and other government agencies, AT&T Corp. charged Monday.

AT&T said it was alarmed by the practice and suggested in a court filing that MCI was recklessly placing national interests at risk. AT&T said it had evidence calls were being diverted as recently as Monday morning.

The claims were made by AT&T in a filing in U.S. Bankruptcy Court in New York, which is considering efforts by WorldCom Inc. to emerge from Chapter 11 bankruptcy protection. WorldCom, brought down by an $11 billion accounting scandal, is adopting the name of its MCI long- distance division in a bid to clean up its image.

Federal prosecutors are also investigating accusations by rival carriers and former MCI executives that the company defrauded other telephone companies of hundreds of millions of dollars in access fees to local carriers.

MCI didn’t return a call for comment. But the company said over the weekend that its competitors were trying to throw up roadblocks to MCI’s emergence from bankruptcy.

AT&T accused MCI of carrying out a coding process that shifted calls to a local carrier in the Midwest, then to a local carrier in the Canadian province of Manitoba, then to Bell Canada and back to the United States on AT&T lines. Bell Canada has a long-standing agreement to send its U.S.-bound calls to AT&T lines.

The company said MCI’s routing deceived AT&T into believing the calls had originated in Canada – forcing AT&T to pay the high local access fees.

AT&T said MCI diverted calls placed by the State Department, a member of Congress, the U.S. Postal Service, the Library of Congress and the U.S. Agency for International Development.

Berge Ayvazian, a telecommunications industry analyst with the Yankee Group, said diverting calls to Canada would not necessarily have made them more prone to eavesdropping.

But phone companies sometimes make arrangements for secure lines – and transferring calls off those lines could pose a risk.

“If WorldCom knowingly routed calls of that nature outside the United States, subjected them to security problems, that would be a big concern,” he said.