New Mexico-Based Computer Assets Inc. Agrees to Settle

FALSE CLAIMS ALLEGATIONS INVOLVING THE E-RATE PROGRAM

WASHINGTON, July 30 /PRNewswire-USNewswire/ -- Computer Assets Inc. and its
principals, Abraham Salazar and Damon Salazar, have agreed to pay $350,000
over three years and surrender up to $35 million in pending E-Rate
applications to settle allegations that the company violated the False Claims
Act in connection with the Federal Communications Commission's E-Rate program,
the Justice Department and the U.S. Attorney's Office for the District of New
Mexico announced today.

The E-Rate program, which Congress created in the Telecommunications Act of
1996, provides funding for needy schools and libraries to connect to and
utilize the Internet. Under the program, which is supported by fees collected
from telephone users, schools apply for funds to pay for hardware and monthly
connectivity service fees.

The United States contended that the Espanola, N.M.-based company violated the
E-Rate program's requirements by engaging in non-competitive bidding practices
for E-Rate contracts with the Kayenta Unified School District in Kayenta,
Ariz. Additionally, the United States alleged that Computer Assets billed for
installing excess and unnecessary networking cable, and in some instances
billed twice for the same work.

These allegations arose from a False Claims Act lawsuit filed in New Mexico
federal court by John Lyons, a former Computer Assets employee. The False
Claims Act allows private individuals to bring civil actions for fraud on
behalf of the United States and to share in the proceeds of any recovery. Mr.
Lyons' share in the settlement will amount to $77,000.

"The E-Rate program provides critical support for Internet access to the most
under-served schools in the nation," said Tony West, Assistant Attorney
General for the Department of Justice's Civil Division. "Working with our
partners at the FCC's Office of the Inspector General, the Department of
Justice is committed to ensuring that this important program, which benefits
our neediest children, not be misused by those seeking to defraud the public."

The Justice Department's Civil Division, with assistance from the FCC's Office
of the Inspector General, handled the investigation and settlement of this
matter. The case is entitled United States ex rel. John Lyons v. Computer
Assets, Inc. et al., Case No.: 05-540 RB/WPL.

SOURCE U.S. Department of Justice

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