Skip to main content

Abernathy to Dump Telecom Stocks

Kathleen Abernathy, President Bush's pick to fill a Republican seat at the
Federal Communications Commission, said Thursday that she will sell thousands of
dollars in telecommunications stocks to comply with federal ethics rules.

Abernathy owns telecommunications stocks worth between $450,000 and $1
million, according to her financial disclosure with the Office of Government
Ethics.

Abernathy's disclosure said she owns between $101,000 and $250,000 in Qwest
Communications International Inc. stock; between $250,001 and $500,000 in
Verizon Communications stock; and between $100,001 and $250,000 in Vodafone
Group plc stock.

'We are divesting everything. I don't know how you could ever do this job if
you were not willing to sell all of those,' Abernathy told reporters after her
Senate Commerce Committee confirmation hearing.

Qwest and Verizon are regional Baby Bell companies heavily regulated by the
FCC. Both firms are looking for agency approval to enter the long-distance
business.

Vodafone, a London-based wireless carrier subject to FCC spectrum-ownership
limitations, is a 45 percent owner of Verizon Wireless.

Abernathy said she would have 90 days from her Senate confirmation to dump
the shares.

'During the interim, I cannot participate in any proceedings [involving those
companies],' she added.

Under federal income-tax rules, Abernathy would not be required to pay
capital-gains tax if she reinvests the money in assets she is permitted to hold.
But capital-gains tax would apply when she sold the new assets at some point.
'It's deferred until you then sell that,' she said.

Abernathy, a 44-year-old lawyer and telecommunications consultant, appeared
before the Senate panel along with Bush's other FCC picks: Republican Kevin
Martin, 34, and Democrat Mike Copps, 61.

FCC chairman Michael Powell, 38, whom Bush nominated for a second five-year
term, also testified in a hearing that was largely uneventful.

The panel is expected to vote on their nominations May 24, committee
spokeswoman Pia Pialorsi said.