The transfer of the common stock of a licensee following her death from one revocable trust to another within the family, minus FCC authorization, resulted in an transfer of control that should have not happened so soon.
To resolve the matter, the FCC and the licensee have entered into a Consent Decree that involves a civil payment to the U.S. Treasury.
In July 2010, KTLO-AM & FM in Mountain Home, Ark., and KCTT-FM in Yellville, Ark., saw a shift in its ownership that resulted in the 60% equity interest in the properties held by the Earls family get sold to the Knight family for $2.25 million.
Fast-forward to February 2020, when Vivian Sue Knight, who had her own trust, died. After her passing her 25% interest in the stations, plus KBOD-FM in Gainesville, Mo., were transferred to the Bobby Dean Knight Revocable Trust.
But, the shift was not documented with or approved by the Commission.
And, the stock move made the Bobby Bean Knight trust a 50% equity interest holder in the four stations.
Then, on October 28, 2021, Bob Knight passed away. This placed the trust in the hands of one Heather C. Loftis.
Nothing was done until April 29 of this year, with an application belatedly seeking Commission consent to the 2020 pro forma transfer of control. Based on those actions, an investigation was launched by the Commission.
But, the Commission said on Tuesday (8/27), the parties acknowledge that any proceedings that might result from the violations would be time-consuming and require a substantial expenditure of public and private resources. “In order to conserve such resources, resolve the matters, and promote compliance with the Rules, the Parties are entering into this Consent Decree, in consideration of the mutual commitments made herein,” the Commission said.
This includes an $8,000 civil penalty to be paid by the Loftis-controlled trust.
Signing off on the Consent Decree for the FCC is Audio Division Chief Al Shuldiner.
