New wave of fraud: why is it dangerous to use free mobile communications in the US
'05.05.2019'
Source: CBS Local
According to a secret investigation, the federal program, which provides free cellular services and telephones for the poor and those in need of Denver, is literally overflowing with cases of fraud and abuse.
The Lifeline program worth 2 a billion dollars a year distributed more than 13 millions of free mobile phones across the country in the first six months of 2018, writes CBS Local. In Colorado, during the first half of the year, the program provided more than 117 000 free mobile phones, or about 20 000 phones every month.
These free phones and their tariff plans are paid for by a monthly tax on your mobile phone, which is called the Universal Service Tax. Although the Lifeline wireless program has existed since 2005 and started under President George W. Bush, it has become incredibly popular under President Obama’s administration, which is why these phones are often called Obamafons.
The program has strict rules: for participation, you need to get food stamps, Medicaid, housing assistance or other benefits from the state, proving that you have a low income. The idea is that people who otherwise could not afford mobile phones can use it to find work, call 911 if necessary, or stay in touch with family members.
But during several visits to the Denver media group to the points where distributors set up tents to distribute free mobile phones, it was discovered that telephone agents were willing to circumvent strict government regulations that require only really needy people to receive free communication. Vendors receive huge government subsidies to distribute phones.
A CBS journalist walked up to one of the tents and pretended to be interested in free communication. When asked by an employee if he had Medicaid food stamps or any other evidence that he was eligible for the phone, the journalist said no. At the same time, one of the agents of the cellular communication program offered to “push” him into the program anyway, using someone else's card with a food coupon.
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The journalist asked if they were really ready to use someone else's card, to which the agent replied in the affirmative: “Yes, this is confirmation of your participation in the assistance program. It will help you. "
He quickly gave the journalist a free phone. It is reported that such an agent receives $ 3 for each phone that he gives "for the intended purpose."
Mark Wigfield, deputy director of media relations, who oversees the Lifeline program, said that using someone else's card with a food stamp is a clear violation of the program’s rules.
"The lifebuoy rules," Wigfield said, "are binding and punishable by fines and other measures."
But representatives of companies producing cordless telephones are trying again and again to bypass federal rules in order to distribute telephones.
A representative of another cell phone company turned to CBS4, a reporter and manufacturer, who said that it would be nice to use other people's food stamps to establish compliance.
This case was not the only one - the journalists walked around several points where they were also offered (or answered in the affirmative to a request to do so) to use other people's food cards. At the same time, the agents did not pay any attention to the fact that the coupons were strangers, and confirmed this fact out loud.
But, apparently, the rules and conscientiousness of the program are being abused by the recipients of free phones themselves. Over and over again, people who received free phones told journalists of the publication that they had expensive smartphones or just mobile phones that they bought with their own money, they freely pay for cellular services, but they could not resist getting a free phone courtesy of taxpayers ...
One person told reporters that he needed a free mobile phone, but he did not meet the requirements. He showed his phone, for which 57 is paying dollars per month. The man explained that he had driven through the entire city, received a food voucher, then returned with the voucher to the Civic Center and could use it to receive an obamafon.
"Absolutely free. I didn't pay a dollar, not a cent, nothing, ”the man laughed. "This is what everyone calls obamapons."
The journalists decided to conduct another experiment. In one of the tents in Denver, they brought a piece of paper on which was simply printed: "Training card." Of course, this sheet did not have anything similar to the document. But instead of immediately rejecting a clearly fake card, the free mobile agent said: “I will try,” and tried to qualify the journalist as suitable for the program.
These problems are not new. The Federal Communications Commission stated that since 2012, it has fined its suppliers more than 95 million dollars for those types of frauds that were discovered during an investigation by CBS journalists.
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As the genfkd.org, in New York, government investigators found that 11 600 users from 61% are not eligible to receive free mobile phones, but already use them. In Florida, 11 000 registered 69% users were not eligible for coverage.
Many third-party companies have forged registration forms and even created fake profiles to steal taxpayers' money under this program.
A three-year investigation by the Government Accountability Office (GAO) revealed that the program was very negligently organized in relation to the inspection of eligible citizens. Since a third of users turned out to be fraudsters, investigators discovered that the FCC unknowingly paid 1,2 a million dollars to fake users.
Most fraudulent users were linked to Total Call Mobile, which was one of the providers of the Lifeline program. After the report came out, the FCC banned Total Call Mobile and fined them 51 a million dollars for fraud.
John Caldara, a critic of government programs and the president of the Independence Institute, said the CBS investigation confirmed: this is “systematic robbery.”
“They set up tents and work with you to defraud taxpayers,” Caldara said. - We see that the people who receive them are those who need these phones. Those of us who actually pay for mobile phones pay more money because other people just get them for free. ”
Caldara said that the entire distribution system of free mobiles is designed to automatically provoke fraud and abuse.
“The system is designed to give gifts to people who don't need it. And we pay for it, ”he added.
