AT&T Deal Faces Scrutiny

Some in Congress demand a delay.
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Two key congressional representatives have asked the Justice Department to delay approval of the merger between AT&T (T) - Get Report and BellSouth (BLS) , according to published reports Thursday.

Reps. James Sensenbrenner, R-Wis., and John Conyers, D-Mich. -- the Republican chairman and ranking Democrat of the House Judiciary Committee -- have asked antitrust regulators to wait on a merger approval until a federal judge has cleared the Justice Department's go ahead on two prior telco mergers, says a Reuters story.

A federal district court judge in Washington is still hearing arguments on whether the mergers between SBC and AT&T, as well as,

Verizon

(VZ) - Get Report

and MCI are in the public interest.

The $78 billion proposed merger between AT&T and Atlanta phone giant BellSouth is expected to close by year end. The deal seemed to have cleared at least one regulatory hurdle on its way to completion.

Last week,

Federal Communications Commission

chairman Kevin Martin

urged the agency's commissioners to approve the deal.

Critics have charged that the Bells have benefited on the regulatory front from their cozy ties to Washington. This close partnership between big phone and government

drew extra scrutiny from consumer-protection and privacy watchdogs in the wake of the domestic spying practices of the

National Security Agency

.

AT&T shares closed down 20 cents at $32.37 and BellSouth closed down 27 cents at $42.44 Thursday.