VeriSign is subject to annual audits, according to a 2001
agreement with ICANN, the body that oversees internet domain names.
The agreement allows the company to continue, under certain rules,
operating its registry and registrar units, and to maintain the
central database for .com domains until 2007.
However the same audit revealed that VeriSign has not kept
adequate historical records of its database system on a daily
basis, as required. The audit also found that the registry has
failed to comply with some technical requirements of the
agreement.
The US Department of Commerce, which oversees the audit process,
has expressed concerns that Ernst & Young did not have access
to sufficient information and therefore could not determine clearly
the degree of VeriSign’s compliance with the terms of the
agreement.
At the same time, VeriSign is facing an investigation by the
Federal Trade Commission, regarding a recent domain name marketing
campaign. The probe follows lawsuits filed by competitors, who have
accused VeriSign of deceptive business practices and “domain name
slamming.”
VeriSign settled one of the lawsuits, filed by BulkRegister,
last week. However, it still faces the same allegations in an
action brought by Go Daddy Software, a smaller domain name
registrar, and in two class actions.
