The Federal Communications Commission has opened an investigation into whether Sony BMG Music Entertainment violated federal guidelines by failing to disclose payments to radio stations for airplay. Two weeks ago, the record company shelled out $10 million to settle a New York State probe that revealed that they compensated various commercial stations for record spins.
On Monday, FCC Chairman Kevin Martin called on the regulatory agency's enforcement bureau staff to examine the settlement agreement for possible evidence of wrongdoing, according to Reuters.
"If the bureau determines violations of the payola rules have occurred, the Commission will take swift action," Martin said in a statement. "In addition, if the bureau is presented with evidence of payola rule violations outside of the Sony BMG Music Entertainment settlement, it is to thoroughly investigate those complaints as well."
The investigation was spurred, in part, by recommendations from FCC Commissioner Jonathan Adelstein and New York Attorney General Eliot Spitzer (see "Sony BMG Apologizes For Payola Involving J. Lo, Avril, Good Charlotte, Others"). Spitzer, the leading force behind the year-long probe into Sony BMG's "pay for play" policy, has pushed for FCC-imposed sanctions against radio stations that accepted payoffs in exchange for airplay; he's suggested that the broadcast licenses for those offending stations be rescinded, according to Reuters.
Spitzer's work with payola allegations continues; he's investigating several other record labels and radio conglomerates for similar criminal claims.
Spitzer's examination into Sony BMG's practices revealed that the label bought airtime for several of its artists' biggest singles, including Jessica Simpson's "Take My Breath Away," Good Charlotte's "I Just Wanna Live," Avril Lavigne's "Don't Tell Me," Franz Ferdinand's "Take Me Out" and Maroon 5's "Sunday Morning." The payola took the form of direct payments to stations and station employees, expensive gifts and even fictitious contest giveaways for listeners which actually went to station employees.