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FCC steps up radio payola probe

Requests documents from 4 corporations after settlement stalls

WASHINGTON -- The Federal Communications Commission is stepping up its investigation into alleged payola practices at four of the nation's largest radio corporations after attempts to reach a settlement stalled.

The FCC confirmed yesterday it had requested documents from Clear Channel Communications Inc., CBS Radio Inc., Entercom Communications Corp., and Citadel Broadcasting Corp.

The agency wants to learn more about accusations that radio programmers received gifts, cash, and other items in exchange for playing songs without publicly disclosing the deals.

''It's important for us to conduct a formal inquiry so we know the full scope of what occurred," FCC commissioner Jonathan Adelstein said yesterdsay. ''There certainly isn't any dispute as to the severity of the potential violations, but there is some dispute as to the scope."

''We need to investigate and uncover more in order to get to the bottom of what happened and see how widespread these practices are," he said.

The FCC requests, known formally as ''letters of inquiry," are the next step in investigations that could result in sanctions ranging from financial penalties to the revocation of stations' licenses.

The four companies have been negotiating with the FCC for weeks after FCC chairman Kevin Martin revealed last month the probe was underway. But talks stalled last month over how much the broadcasters should pay.

Radio executives have said that company policies prohibit accepting gifts for airplay and that internal probes have not revealed widespread wrongdoing. Federal regulations require that radio listeners be informed anytime there is an exchange of items of value for airplay of specific songs.

But Adelstein said he believes the potential violations may be widespread.

''Naturally, people involved want to downplay what happened," he said. ''At first blush, it appears these practices are pervasive in the industry. We will certainly welcome the industry's response to evidence we receive."

New York Attorney General Eliot Spitzer launched an investigation in 2004 into alleged wrongdoing by music and radio companies. This year, Spitzer sued Entercom Communications Corp., accusing its executives of running scams to trade cash for airplay of songs.

Entercom has denied the allegations.

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