We’ve been sounding the warning for many months, but it may be time to sound it again: Fraud may be the weapon that finally kills the government’s outstanding Lifeline Assistance free cell phone program.
Simply stated, low-income residents of Ohio and other states are abusing the program to such a degree that they may be putting the entire program in jeopardy.
According to the Dayton Daily News, 26,500 Ohio recipients have already been busted for violating the rules.
As in other states, Ohio residents’ participation in the program has mushroomed in recent years. In 2008 there were only 280,000 state residents enrolled, but by 2011 it had increased to nearly 600,000. Costs have skyrocketed at a similar rate.
Unfortunately, telephone companies suspect that as many as 5% of all recipients have signed up for more than one line, which is a clear violation of the rules. They have been ordered to choose one carrier and to give up the other within 35 days.
Quite frankly, we’re not surprised by the fraud. The Lifeline program has grown rapidly – too rapidly, perhaps – and rapid growth in any business is often accompanied by a shocking lack of control.
The Federal Communications Commission has also noticed the fraud. It has already begun looking into amending the rules and increasing federal oversight to keep recipients honest.
No wonder. In Ohio, as in most states, the foxes are guarding the henhouse. For some unfathomable reason, the government initially thought the companies that are paid for every customer they sign up should be responsible for making sure everything was on the up and up. Obviously, the honor system has been a bit of a failure.
For example, the application from Assurance Wireless requires the prospective customer to swear, “I am the head of household … (and) I understand that Lifeline Assistance is only available for one land line or wireless phone per household. If I currently have a Lifeline plan with a different phone service provider, I will notify my current provider when I am approved for Assurance Wireless service.” There are 26,500 reasons to believe the affidavit is a joke.
Unbelievably, the FCC found 200,615 fraudulent accounts in the first seven states it audited, including 111,682 in parts of Florida and Tennessee. As a result it is looking into rule changes.
“The commission is very aware of the nature of the problem with duplicate claims and is working aggressively to control it and ensure that it’s held to the lowest possible level if not completely eliminated,” said Eric Iversen, spokesman for USAC. “We provide audits of companies that provide services to make sure they provide services only to eligible consumers.”
How can honest people qualify for one of the free government cell phones? It’s really pretty simple. One way is to be enrolled in a federal aid program such as Medicaid, food stamps, Section 8 or free school lunches. The other way is to earn less 135-150% (depending upon the state) of the federal poverty level (in case you’re wondering that works out to about $33,525 for a family of four).
Once again, if you legitimately qualify for the Lifeline Assistance program, we urge you to sign up. But we urge you to speak up when you see fraud in the program. In these tough economic times it is incumbent on all of us to protect this outstanding program by doing everything we can to weed out fraud.