FCC Payola Probe Involves More Spanish-Language Stations
An FCC investigation into alleged payola at Spanish- language radio stations (CD Oct 27 p8) expanded last week, said two industry lawyers familiar with the probe. Additional licensees or station personnel got letters of inquiry from the Enforcement Bureau dated Oct. 20, said the lawyers, who have seen copies of the documents. The tally of stations, program directors and other employees getting letters is unknown, but is thought to be nearing 50, they said. That’s the number of stations cited in a 2006 suit as allegedly taking money from a Univision Music employee for playing certain top-40 tunes.
Sign up for a free preview to unlock the rest of this article
Export Compliance Daily combines U.S. export control news, foreign border import regulation and policy developments into a single daily information service that reliably informs its trade professional readers about important current issues affecting their operations.
Entravision is among radio companies getting FCC letters, also dated Oct. 16 and 17, said two industry attorneys. The bureau asked whether the recipients got money to play songs on Univision labels from Daniel Mireles. Mireles alleged he was fired by the No. 1 Latin label in the U.S. for balking at making more such payments, said three lawyers who've seen the letters. Mireles’ 2006 suit said he struck payola deals with stations nationwide. Entravision owns 47 radio stations in the top 50 U.S. Hispanic markets. A company spokesman declined to comment. An FCC spokeswoman declined to comment, saying the case is open and before the bureau.
A copy of one letter we obtained asks 13 questions and demands a response within 60 days. It said the FCC received information of “an alleged widespread payola scheme” involving thousands in cash to personnel at the station, citing in part Mireles’ suit. The letter asks for a list of all people with programming responsibilities at the station from Jan. 1, 2000, to now. It asks if the broadcaster or staffers “accepted from any person or entity the payment of money, services, or other valuable Consideration in exchange for the Broadcast of any programming, including but not limited to any song, music or portion thereof.”
Lawyers who have seen the letters said that question is too broad and could be construed to refer to commercials, although that doesn’t seem to be the letters’ intent. “This one question has got everyone scratching their head,” said Francisco Montero, a broadcast attorney. “Arguably that can cover everything.” Several lawyers want to see the list of all stations Mireles claimed got money, a list not part of the original lawsuit. Mireles’ lawyer declined to comment or provide the list. Mireles settled the suit, lawyers said. A spokesman for Universal Music, which bought Univision Music, didn’t reply to messages seeking comment.
One broadcast lawyer who has tried to fight payola hailed the investigation. The FCC hasn’t run many such probes since engineering a $12.5 million settlement in 2007 with four English-language radio companies (CD April 16/07 p1), said the attorney, Arthur Belendiuk. “It’s good to see that the commission is taking this seriously -- it’s a potential serious abuse and the commission needs to investigate,” he said. “I imagine they will stick it to these guys for a few million and that will be the end of it … Even a slap on the wrist to these guys will mean if you do it again, it will be more than slap on the wrist.”