Correction: The fines noted in this article have been proposed by the FCC, but have neither been assessed nor paid at this time.
After announcing last year that Lifeline Assistance, the free government cell phone program, is plagued by fraud and waste, the Federal Communications Commission has now followed up by
announcing proposing millions of dollars in fines on Lifeline service providers.
The FCC said its audit had uncovered thousands of violations in which the companies received duplicate payments and violations. The result? More than $14 million in fines have been
assessed proposed against those companies. The violations include inadequate verification of customer eligibility and over-billing for services rendered.
The FCC issued Notices of Apparent Liability against several free government cell phone providers and announced the following fines:
- TracFone (SafeLink) fined $4.57 million.
- Assist Wireless fined $2.2 million.
- Icon Telecom fined $4.8 million.
- Easy Telephone/Wireless Services fined $1.58 million.
- UTPhone fined $1.23 million.
If you think those fines seem excessive, here’s how WirelessandMobileNews.com say they were determined by the FCC
- A separate forfeiture of $20,000 for each unlawful payment request seeking USF support for ineligible Lifeline subscribers.
- A $5,000 forfeiture per ineligible subscriber.
- An upward adjustment of three times the total duplicate USF support payments requested and/or received.
- The FCC claims that the carriers should have know that based on internal data that customers who received free services were ineligible under Lifeline program guidelines.
Needy Americans can qualify for Lifeline Assistance if someone in the household participates in government assistance programs (Food Stamps, Section 8 Housing or a number of other programs) or if the household’s combined income is below the Federal Poverty Guidelines. Applicants must prove that they receive government assistance or proof of their household income.
This is a huge change in the way the free government cell phone program operates. In the past, service providers were not required to ask for income verification, and as a result, customers could easily receive multiple free cell phones from more multiple providers.
We applaud the FCC’s actions and urge them to boost the fines against those who cheat the system. This valuable program helps millions of Americans every day and shouldn’t be allowed to fail just because a few crooks game the system.
If you know of any violations or even fraud, here’s our page on reporting Lifeline fraud.