“I have never witnessed such greed, arrogance, and mindlessness in my entire career and felt the need to come forward to address what I saw was a blatant misuse of the federal subsidy program by Armstrong’s decisions to improperly allocate costs to pad their profits with government dollars,” Ranko said in a statement issued by his counsel at Phillips & Cohen LLP.
Misallocation of Funds and Government Representation
The law firm statement noted that Armstrong had received tens of millions of dollars in federal funding and, beginning in 2012, misallocated $180,000 per year on company airplane costs for Armstrong Telephone. Ranko, who worked at Armstrong from 2008 to 2016, said he and others suggested developing a cost allocation manual to ensure Armstrong Telephone’s expenditures complied with federal law, but the idea was rejected by executives.
“Accurate reporting of costs by rural telephone carriers is essential to ensure proper allocation of federal subsidy dollars. We applaud our client for coming forward to report his concerns to the Department of Justice and the Federal Communications Commission,” said Colette Matzzie, an attorney for Ranko.
