AT&T; Wrongly Assigned Itself Customers, U.S. Says

Times Staff Writer

Over an 11-month period, AT&T; incorrectly assigned as many as 87,000 long-distance business customers to itself instead of to long-distance competitors that the businesses had selected, the Justice Department announced Wednesday.

The department said it would take no immediate court action against the company because no evidence had been found of a deliberate effort by AT&T; to deprive other firms of customers. But the department warned that, if the problem continues, AT&T; will be liable for fines of as much as $1 million a day.

AT&T; "failed to exercise sufficient care" to ensure that its computer order processing systems were accurate, said one official, speaking on the condition that he not be identified. He added: "It may have been ineptitude, but it wasn't willful."

AT&T; officials disagreed with the department on the number of mistaken orders, saying that it believes that fewer than 5,000 business customers were affected. No residential customers were involved.

"We are working with independent consulting firms to set formalized standards to assure the accuracy of our computerized reporting systems," said William Garrett, AT&T; Communications vice president.

He said the bulk of the problem occurred when business customers placed orders for telephone lines with both AT&T; and one of its competitors. According to Garrett, AT&T; computers mistakenly assigned all of the lines to AT&T.;

Under "equal access" provisions of the 1982 consent decree that restructured AT&T;, customers of the former Bell local telephone companies were allowed to choose AT&T; or another competitor--such as MCI or GTE Sprint--to provide their long-distance service.

The Justice Department was alerted last spring by AT&T; to problems with the phone firm's data processing system for business orders. After a formal complaint by MCI, AT&T;'s largest competitor, the department launched an investigation.

The department's announcement followed a letter that it received Tuesday from Randall L. Tobias, chairman of AT&T; Communications, who said the company has shut down its computer system for business orders; agreed to repay any business customers for any additional charges they incurred from the computer mistakes, and agreed to have its residential order system independently evaluated.

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