From a two-part article:
Otto Reich and the Honduran Coup D’Etat: The Provocateur, his Protege, and the Toppling of a President – Part One
~snip~
With underdeveloped countries such as Honduras or Haiti, there is an overwhelming excess of one-way traffic as a result of emigrants to the U.S. or other Western countries calling their families back home. It is precisely in these extremely poor countries, where the telephone company has not been privatized, that interconnection settlements represent a vital source of revenue to the state. Until recently, the Federal Communications Commission (FCC) intervened on behalf of the multiple carriers who’d emerged as a result of privatization (deregulation) in the United States, to negotiate interconnection rates with other countries that would apply equally to all carriers. In 2004 the FCC’s intervention began to be phased out, and since 2006 it has vanished entirely except for a short list of countries that does not include Haiti or Honduras.
During the fixed-rate years, some U.S. companies still tried to get a better deal regardless, and while state owned companies such as Haiti’s Teleco and Honduras’s Hondutel were free to offer lower interconnection rates than those set by the FCC, they were supposed to be offering them equally to all carriers, not just a privileged few, so as not to make a mockery of the FCC’s system. If payments from the U.S. carrier were involved in securing the discount it would also be a violation of the U.S. Foreign Corrupt Practices Act (FCPA).
This appears to be what occurred with IDT, a New Jersey telecom company that negotiated a special rate to interconnect with Haiti’s Teleco. The FCC’s rate at the time was supposed to be 23 cents per minute for connections to Haiti, but IDT negotiated and received a contract for 9 cents a minute. When a former IDT employee claimed that part of that fee was a kickback to Aristide, the anti-Aristide lobby went crazy.
The Wall Street Journal’s Mary Anastasia O’Grady, followed by Lucy Komisar writing for another non-profit front group sponsored by a Haitian oligarch, the Haiti Democracy Project, claimed that Aristide knew of and personally benefited from the kickback. Before, corruption allegations against Aristide had tended to be confined to equally unproven insinuations about profiting from drug trafficking, such as those Reich provided to O’Grady when he sat down with her for an interview in 2002.
None of the defamatory allegations about Aristide’s involvement in any of the schemes could be proven, and a much publicized court case brought against Aristide by the Haitian (U.S.) puppet government was quietly shelved. But proving the case was secondary to floating the allegations, both as a propaganda tactic against Aristide, and political intimidation of his supporters in the U.S. Congress.
More:
http://machetera.wordpress.com/2009/07/30/otto-reich-and-the-honduran-coup-detat-the-provocateur-his-protege-and-the-toppling-of-a-president-part-one/
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