Oftel is investigating allegations that Kingston Communications, the UK?s sole remaining municipally-owned telephone operator, has breached its licence agreements.
The telecomms watchdog confirmed it had received a complaint, which apparently accuses Kingston of cross-subsidising an ailing subsidiary with its successful telecomms business.
A spokesperson at Kingston dismissed the allegations as ?blatantly untrue?. He said: ?Kingston is the victim of a deliberate campaign which is misguided, mischevious, and wholly unsubstantiated. We are considering legal action against the person or persons concerned.?
It is believed that the allegations were made by a disgruntled local who may have missed out on a prospective deal with Kingston during the time of the mysterious departure of its chief executive, William Aylward, last month. Aylward had been in the job for eight months, and was reported to have been sacked by the board.
The spokesperson would not comment further on the allegations. Kingston has not been short of headlines this year. In January it axed 20 per cent of its 1,530-strong staff in a bid to compete with new operators entering its Hull, Yorkshire area.
Aylward, who was originally brought in as a consultant, oversaw Kingston?s #26.3 million deal to take control of Torch Telecom, its joint venture with Yorkshire Electricity, last October. It was hailed as the Kingston?s biggest ever deal.
Kingston Communications was created in 1904 as a department of the Hull Corporation. It now provides telecomms services internationally through offices in France, Germany, Hong Kong and north America.
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